Congress demands probe into Rafale deal following report that million Euros were paid as ‘gift’ to clients

India’s ‘biggest defence deal i.e. purchase of 36 Rafale jet fighters from Dassault Aviation’ is a sordid saga of ‘loss to public exchequer’, ‘squandering national interests’, propagating the ‘culture of crony capitalism’ and ‘shrouded in secrecy’ by negating the mandatory aspects of procurement prescribed in ‘Defence Procurement Procedure’, AICC General Secretary Randeep Singh Surjewala said in a press statement on Monday.

“The devastating sensational revelations in the last evening report of French News portal/agency – Mediapart.fr have now revealed existence of middleman, payment of commission and red flags raised by the French Anti-Corruption Agency – AFA,” he added.

He demanded a full and independent investigation into the deal to find out as to how much bribery and commission in reality, if any, was paid and to whom in the Indian government.

He also demanded that Prime Minister Narendra Modi must respond to the revelations.

Here are the relevant excerpts from Surjewala’s press statement:

The allegations of causing loss to public exchequer, bribery and payment of commission in India’s biggest defence deal once again stare in the face of Modi Government.

Facts

1. 10th April, 2015 – Prime Minister, Shri Narendra Modi announces purchase of 36 Rafale Aircrafts - ‘off the shelf’ during his visit to France.

2. 23rd September, 2016 – Modi Government signs a formal agreement with France to buy 36 Rafale Aircrafts for US$ 8.7 Billion or €7.8 Billion i.e. Rs.60,000 crore.

3. Defence Procurement Procedure as also the stated Indian Government Policy envisages that there will be an “Integrity Clause” in every defence purchase contract. There can be no middleman or payment of commission or bribe. Any evidence of middleman or commission or bribery has serious penal consequences of banning of the supplier defence company, cancellation of contract, registration of FIR and imposition of heavy financial penalties on the defence supplier company.

4. An investigation conducted by “French Anti-Corruption Agency – AFA” has now revealed that after signing of the deal in 2016, Dassault i.e. manufacturer of Rafale has paid 1.1 Million Euro to a middleman i.e. Defsys Solutions. This amount was shown as “Expenditure by Dassault as “Gifts to Clients”.

On 30th March, 2017, Dassault gave an explanation to the French Anti-Corruption Agency stating that this was payment for manufacture of 50 models of Rafale.

Reportedly, three questions were asked by the French Anti-Corruption Agency from Dassault – (a) Why has Dassault asked an Indian company to make models of its own aircrafts and that also at €20,000 per piece?; (b) Why was this expenditure then entered as “Gifts to Clients”?; and (c) Were these models ever made? If yes, where and when were they displayed?

Reportedly, no reply was ever submitted to the satisfaction of French AFA by Dassault pointing towards a hidden financial transaction.

5. Defsys Solutions, India is actually a company undertaking assembly of flight simulators and optical & electronic system etc.

Questions:

1. Was the payment of €1.1 Million shown by Dassault as ‘Gifts to Clients’ in reality a commission paid to middleman for the Rafale Deal?

2. How can “Middleman” and “Payment of Commission” be permitted in a ‘Government to Government Defence Contract” or in any defence procurement in India in violation of the mandatory Defence Procurement Procedure?

3. Has it not vitiated the Rafale deal entailing imposition of heavy financial penalties on Dassault, banning of the company, registration of an FIR and other penal consequences?

4. Does it now not require a full and independent investigation into India’s biggest defence deal to find out as to how much bribery and commission in reality, if any, was paid and to whom in the Indian government?

5. Will Prime Minister, Shri Narendra Modi answer to the nation?