(Or what they don’t want us talk about)

Modi-Ambani Rafale Defence Scam

The Rafale fighter jet deal by the BJP Government with the French company Dassault Aviation is turning into the mother of all defence scandals. Anil Ambani’s newly minted defence company bagged a huge defence deal at the cost of PSU Hindustan Aeronautics Limited (HAL) though it has zero experience in the defence sector!

A recap of the facts:

The previous deal that the UPA Government was making involved buying 126 Rafale jets for Rs 54,000 crore – 18 of which would be in a ready-to-fly condition while the rest would be manufactured by the public sector Hindustan Aeronautics Limited (HAL) using technology that Dassault would be obligated to transfer. This deal was cancelled, and overnight the new deal signed by the Modi Government instead obtained 36 jets (in a ready-to-fly condition) at Rs 58,000 crore, minus the transfer technology. Anil Ambani, owner of the Reliance Defence Limited (RDL) Company, registered just 2 weeks before the deal, accompanied Prime Minister Modi on his France trip and secured the partnership with Dassault and 30,000 Cr worth ‘’offset contract’’ instead of experienced public sector company HAL.

Now, in an explosive revelation, former French President Francois Hollande has told a reputed French news organisation Mediapart that it was the Indian Government which proposed that Reliance replace HAL - the French Government had no choice. Later, Hollande reiterated to Le Monde that the name of Reliance Group had appeared as part of a ‘new formula’ in negotiations over the Rafale deal, decided by the Modi government after it came to power.

Hollande’s revelation directly contradicts the Modi Government’s claim that it had no choice in deciding Dassault’s offset partners. It ties Prime Minister Modi directly to the suspicious replacement of HAL with RDL, reduction in the number of jets and huge increase in costs.

Why was the inexperienced two-week-old RDL preferred over the experienced public sector HAL? Why did the new deal cost India two and half times more than the cost negotiated by the previous Government? Why did the new deal lack the transfer technology which was part of the previous deal? How did Ambani’s RDL get the lion’s share of ‘offsets’ after the deal, despite zero experience in the defence production?

The Rafale Deal is not only marred by a massive loss to the public exchequer, but there were also unashamed violations of the procedure of defense procurement. For instance, there was violation of the well-established procedure of sanction from the Cabinet Committee of Security (CCS), in the time of announcement of the deal.

There is another Reliance subsidiary company, Reliance Aerostructure Ltd. The Defence Ministry provided the license to manufacture fighter aircrafts to this company. But shockingly, the company did not own any land or building on the date of the license (22 February, 2016). So how did it get the license to manufacture fighter aircrafts? Did the Government even cross-check these basic facts before granting license?

Another important fact is that the Reliance Aerostructure Limited came into being on 24 April, 2015 – just 14 days after Modi Government’s deal with the Dassault Aviation. So, one Reliance company was registered just two weeks before the deal and another came into existence just two weeks after the deal and got the contract!

Reliance Defence Limited (RDL) through a press release of 16 Feb 2017, claimed that it has secured the Offset Contract from Dassault Aviation for Rs.30,000 crore and a consequent Lifecycle Cost Contract of Rs 1 Lakh Cr. The Dassault Aviation too, in its Annual Report 2016-17, mentioned about the offset contract.

But on 7 February, 2018, the Defence Minister Nirmala Sitharaman, in a PIB release claimed that the “no Indian Offset Partner for the 2016 deal for 36 Rafale Aircraft has been so far selected by the vendor”! So, is the Defence Minster not even aware of such an important contract worth 1 lakh 30,000 crore? Can Reliance and Dassault Aviation sign such huge ‘offset and life cycle cost contracts’ without the approval of the Defence Minister? Or is the Government just blatantly lying in a desperate bid to cover-up this shameful and inexplicable offset contract favouring junior Ambani?

In the wake of the Hollande expose, the Modi Government is coming up with a series of blatant lies to try and defend the Prime Minister. To quote from an Alt News piece exposing these lies:

“On September 22, the official handle of the BJP tweeted that there is incontrovertible evidence that a Memorandum of Understanding (MoU) had existed between Dassault Aviation, the manufacturer of the Rafale aircraft, and Reliance Defence since February 2013, when the UPA government was in power.

The same was reiterated by Union Law Minister Ravi Shankar Prasad who tweeted a link to an article by Times of India dated February 13, 2012 which reported that a defence pact was signed between Dassault Aviation and Reliance Industries Limited (RIL). …

Reliance Industries Limited (RIL), which had inked a defence pact in 2012, is headed by Mukesh Ambani. His brother Anil Ambani heads the Reliance Anil Dhirubhai Ambani Group. The demerger of Reliance Industries took place in 2005…

The current agreement is between Dassault Aviation and Reliance Defence Limited, which was incorporated on March 28, 2015, days before the existing agreement was scrapped and a new deal was sealed in April 2015 for the purchase of 36 Rafale jets in a flyaway condition.  

Reliance Defence Limited is an entity of the Anil Dhirubhai Ambani Group (ADAG) and NOT Reliance Industries Limited (RIL) which is owned by Mukesh Ambani. The newspaper reports that the BJP is referring to were with regard to the agreement between Dassault Aviation and the Mukesh Ambani-owned RIL….

BJP’s claim that Reliance Industries Ltd. was already party to the agreement signed by the previous government is, simply put, false. The Times of India article that the party has referred to is about a defence pact that was signed between Dassault Aviation and RIL, which is owned by Mukesh Ambani whereas the current agreement has awarded the offset contract to Reliance Defence Ltd which is owned by his brother Anil Ambani. With the government tying itself in knots over its defense of the Rafale deal which has been mired in controversy, this attempt at eyewash is rather embarrassing.”

Why did Modi favour Anil Ambani’s company - even though Ambani’s Reliance is mired in NPAs (unpaid bank loans) and failing ventures - over the experienced HAL? What did Modi and BJP get in return? Well, the Modi Government has made it easier for Anil Ambani and other moneybags to pay the BJP secretly without anyone being the wiser: by introducing payment via electoral bonds which will keep the identity of the donor and the amount paid a secret, kickbacks became quite easy.

The Jio Institute of Cronyism

The Government’s decision to award the “Institute of Eminence’ tag to the as yet non-existent Jio Institute of Reliance Foundation (belonging to Mukesh Ambani) has underscored the brazen cronyism that marks the Modi model of governance. Very recently, investigative stories by journalist Ritika Chopra in The Indian Express has shown how even the Finance Ministry told the HRD that the eminence tag for a non-existent institute defies any logic and destroys the education system. The Department of Expenditure (DoE) of Finance Ministry wrote to the HRD Ministry on February 23, 2017: “This methodology will give an edge to an institution which is not even established yet by improving its brand value and positioning it above the already established government and private institutions. This will be demotivational and therefore, detrimental to higher education ecosystem. Grading an institution as ‘Institutions of Eminence’ only based on intentions and a plan defies all logic. Hence the same should be revised.” (Indian Express, August 29, 2018)

Further, doubts were expressed within the HRD Ministry itself in July, 2016. At that time, the Department of Higher Education under the HRD Ministry circulated an internal note seeking comments. Responding to this, the technical education division, which looks after IITs, NITs, IIITs and AICTE, wrote back:

“Considering that established global reputation of the alumni and research are crucial factors in these ratings (international rankings), new institutions cannot make this grade in a five-year period. The focus should therefore be on institutions which currently exist and are already in the global ranking scenario.”

Another division, which looks after international collaboration in the education sector, also wrote back on August, 2016:

“In order to correctly evaluate the institutions based on their past performance, there should be at least 5-6 batches who have graduated from the institution and, therefore, the institution should be in existence for about 8 to 10 years”.

Another report by Chopra (Indian Express, August 28, 2018) showed how brazenly the Prime Minister’s Office (PMO) pushed for the Jio Institute, against its own HRD ministry. The HRD Ministry’s draft stated that members of the sponsoring organisation of a Greenfield (proposed institutes which are yet to be set up) private institution should have experience in setting up a higher education institution. The PMO changed it to members with “commitment” to education. Why such a broad and vague clause? Of course, to benefit Ambanis as they have zero contribution in the field of higher education.

The HRD Ministry wanted private institutions seeking IoE status to possess adequate land at the time of application but the PMO pushed only an in-principle commitment to make land available would be sufficient. So an institute of “eminence” even without the land to establish the university? Is not that crossing all limits?

There is a pattern in the Jio and Rafale scams. In both cases, a company belonging to a CEO close to Modi, formed companies which lack experience in the sector concerned (defence and education) and bagged a plum deal over other, more experienced entities. Not only does this reek of cronyism, it also shows the Modi Government’s scant concern for the interests of India’s defence and education.       

Recently, facts have come to light exposing how the Modi Government helped Mallya flee the country after looting our banks via unpaid NPAs.

The CBI deliberately dilute its Lookout circular asking police “to inform the advance arrival/departure of the subject discreetly” and instructing them that they did not require Mallya to be detained. Also, Mallya has revealed that he met the then Finance Minister Arun Jaitley before he left the country, thus exposing that Jaitley and the Modi Government knew he was leaving the country and facilitated his escape.   

The 30 K Crore Rafale scams makes Bofors look like kindergarten. It is clear that ‘Chowkidar’ Modi has helped corporate scamsters loot the country - and has made it easier for them to payoff the BJP via secret electoral funding.

Ravishankar Prasad has tried to say that it is unheard-of for the sitting PM to be called ‘Chor’ (thief). That’s a lie, of course. After Bofors, the slogan was “Gali gali main shor hai, Rajiv Gandhi chor hai” (in every lane the cry arises - Rajiv Gandhi is a thief). BJP MPs called Manmohan Singh a thief in Parliament and Arun Jaitley defended them.

Now, all over the country, the cry arises against Modi - ‘Rafale Thief, Quit Your Seat’! No amount of diversion tactics and repression will shut down this cry.