The Bofors scandal was a major weapons-contract political scandal that occurred between India and Sweden during the 1980s and 1990s, initiated by Indian National Congress politicians and implicating the Indian prime minister, Rajiv Gandhi, and several other members of the Indian and Swedish governments, who were accused of receiving kickbacks from Bofors AB, an arms manufacturer principally financed by the Wallenberg family's Skandinaviska Enskilda Banken,[1] for winning a bid to supply to India their 155mm field howitzer.[2] The scandal relates to illegal kickbacks paid in a US $1.4 billion deal between the Swedish arms manufacturer Bofors with the government of India for the sale of 410 field howitzers, and a supply contract almost twice that amount. It was the biggest arms deal ever in Sweden, and money marked for development projects was diverted to secure this contract at any cost. The investigations revealed flouting of rules and bypassing of institutions.[3]
On 16 April 1987, a Swedish radio station broke out a story based on a whistleblower in the Swedish police, alleging that the reputed Swedish artillery manufacturer Bofors had paid kickbacks to people in several countries, including Sweden and India, to secure a ₹15 billion (equivalent to ₹200billionorUS$2.6billion in 2023) contract. This had been done the previous year for a deal to supply 410 155mm calibre howitzers for the Indian army.[4] However, none of the newspapers in India were aware of this. In May 1987, a broadcast by a Swedish radio station revealed that bribes of ₹600 million (equivalent to ₹8.2billionorUS$100million in 2023) had been paid by Bofors to Indian politicians, members of the Congress party and bureaucrats. This was picked up by a young journalist from The Hindu, Chitra Subramaniam, who happened to be in Sweden at that time, covering another story. The scale of the corruption was far worse than any that Sweden and India had seen before and directly led to the defeat of Gandhi's ruling Indian National Congress party in the November 1989 general elections.[5] The Swedish company paid ₹640 million (US$8.0million) in kickbacks to top Indian politicians and key defence officials.[6]
The case came to light during Vishwanath Pratap Singh's tenure as defence minister, and was revealed through investigative journalism tipped off by a Reuters news revelation on Swedish radio, followed up by a team led by N. Ram of the newspaper The Hindu.[7] Subramaniam, reporting for The Hindu, secured the over 350 documents that detailed the payoffs. Later the articles were published in The Indian Express and The Statesman when The Hindu stopped publishing stories about the Bofors scandal under immense government pressure and Subramaniam moved to the two newspapers. In an interview with her, published in The Hoot in April 2012 on the 25th anniversary of the revelations,[8] Sten Lindström, former chief of Swedish police, discussed why he had leaked the documents to her and the role of whistle-blowers in a democracy.[2]
Chronology of events and investigation
1977 - As a response to reports that Pakistan wants to acquire brand new American long-range 155-mm M198 howitzers (which was actually withheld due to US political concerns[9]), India requested Bofors and six other manufacturers to suggest their towed howitzers.[10]
1985 - FH-70 and GHN-45 were eliminated from the trials.[10]
March 24, 1986 - A $285 million contract between the Government of India and Swedish arms company Bofors was signed for supply of 410 155mm Howitzer field guns.[11]
April 16, 1987 - Swedish Radio alleged that Bofors paid kickbacks to people from a number of countries including top Swedish[12] and Indian politicians and key defence officials to seal the deal.[11][13]
1987 - As a result of the revelations, the Indian government blacklisted Bofors, preventing the company from doing business in India.[14] The middleman associated with the scandal was Ottavio Quattrocchi, an Italian businessman who represented the petrochemicals firm Snamprogetti.[2] Quattrocchi was reportedly close to the family of Rajiv Gandhi and emerged as a powerful broker in the 1980s between big businesses and the Indian government.[2]
1997 - The Swiss banks released some 500 documents after years of legal battle.
1999 - The Indian government lifted its ban on Bofors. The lifting of the ban came during the Kargil War, when the Bofors guns proved to be efficient but were crippled by a shortage of spare parts.[14]
May 31, 2005 - The Delhi High Court dismissed the allegations against the British business brothers, Srichand, Gopichand and Prakash Hinduja, but charges against others remained.[19]
December 2005 - B. Daat, the Additional Solicitor General of India, acting on behalf of the Indian Government and the CBI, requested the British Government that two British bank accounts of Quattrocchi be unfrozen on the grounds of insufficient evidence to link these accounts to the Bofors payoff. The two accounts, containing €3 million and $1 million, had been frozen. On 16 January, the Indian Supreme Court directed the Indian government to ensure that Quattrocchi did not withdraw money from the two bank accounts in London. The CBI, the Indian federal law enforcement agency, on 23 January 2006 admitted that roughly ₹210million, about US$4.6 million, in the two accounts have already been withdrawn by the accused. The British government released the funds later.[15]
January 16, 2006 - CBI claimed in an affidavit filed before the Supreme Court that they were still pursuing extradition orders for Quattrocchi. The Interpol, at the request of the CBI, has a long-standing red corner notice to arrest Quattrocchi.[20]
6 February 2007 - Quattrocchi was detained in Argentina on 6 February 2007, but the news of his detention was released by the CBI only on 23 February. Quattrocchi was released by Argentinian police. However, his passport was impounded and he was not allowed to leave the country.[21] As there was no extradition treaty between India and Argentina, the case was presented in the Argentine Supreme Court. The government of India lost the extradition case as the government of India did not provide a key court order which was the basis of Quattrocchi's arrest. In the aftermath, the government did not appeal this decision because of delays in securing an official English translation of the court's decision.[22]
March 4, 2011 - A Delhi court provided temporary relief to Quattrocchi from the case, for lack of sufficient evidence against him.[23]
Despite the controversy, the Bofors gun was used extensively as the primary field artillery during the Kargil War with Pakistan and gave India 'an edge' against Pakistan according to battlefield commanders.[25]
In his book, Unknown Facets of Rajiv Gandhi, Jyoti Basu and Indrajit Gupta, released in November 2013, former CBI director Dr A P Mukherjee wrote that Rajiv Gandhi wanted commission paid by defence suppliers to be used exclusively for the purpose of meeting expenses of running the Congress party.[26] Mukherjee said Gandhi explained his position in a meeting on 19 June 1989, during a meeting between the two at the Prime Minister's residence.[27] However, as per Sten Lindstrom, the former head of Swedish police, who led the investigations, they did not find anything to suggest that payments had been received by Rajiv Gandhi. He was, however, guilty of knowing about the kickbacks and not taking action on them.[28]
Political effects
The Bofors scandal was a major issue that was highlighted in subsequent elections, which led to the Congress losing power. Though it was widely believed that V.P. Singh resigned from Rajiv Gandhi's cabinet due to the Bofors scandal, Singh clarified that he had resigned due to differences in the cabinet in commissions taken by Indian agents in the HDW submarine deal (Shishumar class).[29]
Middlemen in Indian arms deals
Middlemen were employed in arms deals in India, both during the British Raj as well as in independent India, and commissions were paid to them under various headings and guises.[30] Some of these were paid as personal bribes while others were paid as contributions to political parties.[31] This led to high levels of corruption, and payments being made to politicians, bureaucrats and defence personnel to influence decisions. The political controversies caused by the Bofors Scandal, led to the banning of middlemen in arms deals.[32][33][34]
In 2015, the Government of India under the Narendra Modi government made the use of middlemen in arms deals legal, if they called themselves "company representatives".[35] The then defence minister Manohar Parrikar announced that in such cases, middlemen would be paid by the government for fixing arms deals under the name of "legal fees".[36]
Allegations against CBI
A former cabinet minister of the Bharatiya Janata Party, Arun Jaitley, criticised the manner in which CBI has handled this case, including:
Not appealing against the judgement of the Delhi High Court in 2004
De-freezing of Quattrocchi's bank account in London by saying to the Crown Prosecutor that there is no case against Quattrocchi[37]
Putting up a very weak case for Quattrocchi's extradition from Argentina. Subsequently, no appeal against lower court's verdict[38]
The withdrawal of the Interpol Red Corner notice[39]
Finally, withdrawal of its case against Quattrocchi. Reacting to this, Chief Metropolitan Magistrate Vinod Yadav said that, "I agree that there are certain malafide intentions in the case and there is no doubt in that"[40]
Closure
The closure of Bofors case was full of twists and turns. In 2004, Delhi High Court posthumously gave clean chit to Rajiv Gandhi and said that there was no case of corruption against him or any public servant. This judgement stunned CBI as it had pursued the case for 14 years and was a setback to NDA government headed by Atal Bihari Vajpayee as well. However, CBI said that it would contest the judgement in Supreme Court.[41]
In 2011, a Delhi court allowed CBI to close the case.[42] Thereafter in 2012, Swedish police chief Sten Lindstrom, who led the investigations and identified himself as the whistleblower, said that Rajiv Gandhi had done nothing wrong and also cleared Bollywood actor Amitabh Bachchan and his family from any involvement in the scandal. Instead, he accused Swedish government of diverting funds marked for development projects to secure the deal by flouting the rules and bypassing the institutions.[43]
Rajiv Gandhi was an Indian politician who served as the 6th Prime Minister of India from 1984 to 1989. He took office after the assassination of his mother, then–prime minister Indira Gandhi, to become at the age of 40 the youngest Indian prime minister. He served until his defeat at the 1989 election, and then became Leader of the Opposition, Lok Sabha, resigning in December 1990, six months before his own assassination.
AB Bofors is a former Swedish arms manufacturer which today is part of the British arms manufacturer BAE Systems. The name has been associated with the iron industry and artillery manufacturing for more than 350 years.
The Central Bureau of Investigation (CBI) is the domestic crime investigating agency of India. It operates under the jurisdiction of the Ministry of Personnel, Public Grievances and Pensions. Originally set up to investigate bribery and governmental corruption, in 1965 it received expanded jurisdiction to investigate breaches of central laws enforceable by the Government of India, multi-state organised crime, multi-agency or international cases. The CBI has attracted numerous controversies and criticisms due to various reports of irregular practises, excessive political influence, and a poor conviction rate. CBI is exempted from the provisions of the Right to Information Act. CBI is India's officially designated single point of contact for liaison with the Interpol.
Air Chief Marshal Shashindra Pal Tyagi, more commonly known as S P Tyagi, is an Indian Air Force officer who served as the 20th Chief of Air Staff of the Indian Air Force and served from 31 December 2004 to 31 March 2007. He was succeeded by Air Chief Marshal Fali Homi Major.
Ottavio Quattrocchi was an Italian businessman who was being sought until early 2009 in India for criminal charges for acting as a conduit for bribes in the Bofors scandal. Quattrocchi's role in this scandal, and his proximity to Indian prime minister Rajiv Gandhi through his wife Sonia Gandhi, is thought to have contributed to the defeat of the Congress Party in the 1989 elections. In 1999, the Central Bureau of Investigation (CBI) named Quattrocchi in a chargesheet as the conduit for the Bofors bribe. The case against him was strengthened in June 2003, when Interpol revealed two bank accounts, 5A5151516M and 5A5151516L, held by Quattrocchi and his wife Maria with the BSI AG bank, London, containing Euros 3 million and $1 million, a "curiously large savings for a salaried executive". In January 2006, these frozen bank accounts were unexpectedly released by India's law ministry, apparently without the consent of the CBI which had asked for them to be frozen.
Fälthaubits 77 or FH77 is a Swedish 155 mm howitzer, developed and manufactured by Bofors. It is also colloquially known as the Bofors gun in India. There were several versions, the original with a 38 calibre barrel and sliding block mechanism, the export version FH77 B version with a 39 calibre barrel and an interrupted ogival screw breech. For the demonstrator of the Archer Artillery System, some FH77A were modified into FH 77 AD L/45, while the series production were FH77Bs rebuilt into FH77 BW L/52. The carriage was also used for the "12 cm rörlig kustartilleripjäs m/80 KARIN", used in the Swedish coastal artillery.
S. K. Bhatnagar was a former defence secretary of India. He was a key figure of those accused in the Bofors scandal.
The Barak Missile scandal was a case of alleged defence corruption relating to the purchase of Barak 1 Missile Systems by India. The Central Bureau of Investigation (CBI) investigated the case and several people including R. K. Jain, former treasurer of the Samata Party were arrested. The CBI investigated the case and filed a First Information Report (FIR) on 10 October 2006, accusing politicians Defence Minister George Fernandes, Jaya Jaitly, R. K. Jain of receiving kickbacks from arms dealer and former Indian Navy officer Suresh Nanda.
Chitra Subramaniam Duella is an Indian journalist. She is recognized in India for her investigation of the Bofors-India Howitzer deal which is widely believed to have contributed to the electoral defeat of former prime Minister Rajiv Gandhi in 1989. She founded CSDconsulting, a Geneva based specialised consultancy working in the area of public health, trade policy, development directions and media. She is also the co-founder and Managing Editor of The News Minute – an online news website. She was an Editorial Adviser for Republic TV of Arnab Goswami. In 1989, she was honoured with the Chameli Devi Jain Award for Outstanding Women Mediaperson.
Suresh Nanda is an Indian businessman and former officer in the Indian Navy. He is the chairman of the Claridges Group of Hotels and ran Dynatron Services, an engineering firm before entering into the hospitality sector.
The first cabinet of Ingvar Carlsson was the cabinet of Sweden between 12 March 1986 and February 1990. The cabinet was formed as a direct consequence of the assassination of the incumbent prime minister Olof Palme on 28 February 1986. After which the Speaker of the Parliament, Ingemund Bengtsson, in accordance with the Constitution of Sweden discharged all ministers.
Milon Kumar Banerji was an Indian jurist who was Attorney General of India from 1992 to 1996 and again from 2004 to 2009. He was also Solicitor General from 1986 to 1989. He died on 20 July 2010 after a long illness, having suffered a stroke in December 2009. He was 82.
The Scorpene deal scam was an Indian bribery scandal, in which USD 175 million were alleged to have been paid to government decision makers by Thales. Defence minister Pranab Mukherjee had approved a deal to build Scorpène-class submarines worth US$3 billion with Thales, France in October 2005. The investigating agency, Central Bureau of Investigation (CBI), found no evidence of corruption in the deal in 2008. Scorpène-class submarines are now being built in India under a technology transfer agreement that was part of that contract.
Also referred to as the AgustaWestland VVIP chopper deal, the Indian helicopter bribery scandal by Congress led UPA Government refers to a multimillion-dollar corruption case in India, wherein money was paid to middlemen and Indian officials in 2006 and 2007 to purchase helicopters for high level politicians. As per the CBI, this amounted to ₹2.5 billion (US$31 million), transferred through bank accounts in the UK and UAE.
Ajay Agarwal is a lawyer in the Supreme Court of India and a politician. He is the candidate representing the Bharatiya Janata Party from Rae Bareli in the 2014 Indian general election. During his tenure on the Supreme Court, he filed public interest litigations in several cases including the Bofors scandal, the Taj corridor case, and the fake stamp paper scam run by Abdul Karim Telgi.
The defence industry sector of India is a strategically important sector in India. India has one of the world's largest military forces with a strength of over 14.4 lakh active personnel. It has the world's largest volunteer military of over 51 lakh personnel. The total budget sanctioned for the Indian military for the financial year 2021 is ₹4.78 lakh crore. It has the third largest annual defence budget behind USA and China. It is the second largest defence importer behind Saudi Arabia making up 9.2% of global arms import. India has a domestic defence industry of which 60% is government owned. The public sector includes NTRO, CSIR, PRL, DRDO and its 50 labs, 4 defence shipyards, 12 defence PSUs. India has a new defence procurement, acquisition and manufacturing policy to reduce imports and enhance domestic manufacturing.
Abhishek Verma is a billionaire arms dealer globally known as the 'Lord of War' and was the main suspect in the Scorpene Submarines deal scandal but was exonerated by Indian Courts in 2015.
India–Sweden relations are the bilateral ties between India and Sweden. Sweden recognised India's independence from the United Kingdom in 1947; both nations established formal diplomatic relations in 1949. India has an embassy in Stockholm, while Sweden has an embassy in New Delhi and honorary consulates in Chennai, Kolkata and Mumbai.
Vipin Kumar Khanna was an Indian business magnate and army officer. Khanna had diverse business interests. He founded Dynamic Sales Service International, a commodities trading and marketing company which further expanded into engineering support, shipbroking, fast-moving consumer goods and additional industries as well. Khanna also had other business interests, which included interests in the arms, aerospace, software, investment banking, hospitality, real estate, alcohol and drinks industries. He was a Non-Resident Indian based in London, England, and also had a base in Delhi, India.
1 2 3 Vas, Lt Gen E. A.; Kathpalia, Lt Gen P. N.; Bakshi, G. D.; Kanwal, Gurmeet; Rockall, George; Kaushik, Brig O. P.; Saksena, Col K. P.; Tiwathia, Maj Vijay; Joshi, Dr Manoj (July 1987). Indian Defence Review July-Dec 1987 (Vol 2.2). Lancer Publishers. p.13. ISBN9788170620297.
This page is based on this Wikipedia article Text is available under the CC BY-SA 4.0 license; additional terms may apply. Images, videos and audio are available under their respective licenses.
