Even Before Bhushan, Sinha and Shourie Could Begin Their PC, Media Houses and Editors Discreetly ‘Told’ to Prominently Incorporate Govt’s Views on Rafale Scam

Even before former cabinet ministers in the Atal Bihari Vajpayee government, Arun Shourie and Yashwant Sinha, along with Supreme Court advocate Prashant Bhushan could begin their Press Conference (PC) at the Delhi Press Club on Wednesday, regarding the Rafale Jet Fighter deal, senior I&B and PMO officials were furiously working their phones.

IndiaScoops.com has learnt that government officials and BJP spokespersons including a PR agency phoned several ‘friendly’ editors of newspapers and news TV channels requesting them to either boycott the PC or relegate it’s coverage to the inner pages and non-peak time TV telecast.

The Anil Dhirubhai Ambani Group PR team was also on its toes, trying to find out which correspondents were attending the event.

IndiaScoops.com  spoke to five senior editors – three from national dailies and two from mainline news channels who admitted off the record that they got ‘how are you’ calls from the I&B Ministry and the PMO inquiring if they were covering the PC called by the trio.

Other editors from pro-BJP outlets refused to speak to IndiaScoops.com, or simply banged down the phone when queried on the subject, but their impulsive curtness was an indication of their indignation.

Two editors told IndiaScoops.com that they were asked as to which reporter or correspondent was covering the event, while others were indirectly advised and reminded to prominently feature the government view in their reportage of the PC.

According to a report in the Indian Express at a press meet, Shourie, Sinha and Bhushan said public sector unit Hindustan Aeronautics Limited, which was part of the original negotiations, was pushed out and a newly-minted company, Reliance Defence Ltd, which had zero experience in defence manufacturing bagged an offset contract. They said such an agreement between Reliance Defence and Dassault Aviation, which makes Rafale jets, should have come after governmental approval.

Sinha said Bofors “pales into insignificance” when compared to this “scam”. They said statements of then foreign secretary S Jaishankar and Defence Minister Manohar Parrikar suggest that none of them were aware of the new deal to buy 36 jets, against 126 aircraft as per a Request for Proposal issued in 2007, for which Dassault had been selected as it was the lowest bidder, reports the Indian Express.

“Nobody in the Air Force or the defence ministry was aware” of the reduction, Bhushan told media persons at the PC.

They also said there were no additional add-ons as per Indian specifications, as claimed by the government, compared to the original RFP. They quoted the joint statement by India and France on April 10, 2015, which mentioned that the 36 jets to be delivered by Dassault “and associated systems and weapons would be delivered on the same configuration as had been tested and approved by the Indian Air Force”.

Calling it an “enormous scandal which jeopardizes national security”, Shourie asked the government to make details of the deal public, reports Indian Express.

Regarding Dassault’s deal with Reliance Defence, he asked if it could have happened “without a nudge and a wink” from the government. He highlighted that offset guidelines of the government issued on April 1, 2016, mention that “all offset proposals will be processed by the Acquisition Manager and approved by Raksha Mantri, regardless of their value”.

A joint statement issued by the Bhushan, Sinha and Shourie said, “Could an experienced manufacturer like Dassault have picked a company that had no experience whatsoever of manufacturing aircraft…without the approval from the government and particularly the PM?”

The statement said a “private party which has had absolutely no experience in manufacturing aerospace and defence equipment has been handed an enormous financial benefit.” They demanded an independent audit by Comptroller and Auditor General.

The government machiney spun into action immediately after the PC was over. A statement was ready and emailed to most media persons. Correspondents from wire services were also sent the government’s version to counter the allegations made by the trio.

A few hours after the press meet, Arun Jaitley wrote in a blog post, “There is not a grain of truth in the wild allegations repeated today nor anything substantiating in the purported facts and voluminous documents marshaled to corroborate the baseless accusations,” he claimed

Jaitley added that the allegations constitute nothing but “reprocessed lies by forces increasingly desperate to prove their relevance”. He said the government had already responded effectively to every distortion and misinformation on the issue.” reported the Indian Express.

with inputs from Indian Express and Agencies

The Jio Institute Effect: Mukesh Ambani’s Reliance Group to donate over Rs 1200 Cr to BJP in Electoral Bonds over one year, for Elections 2019

IndiaScoops.com Political Bureau | Mumbai | 11th July 2018: In a survey conducted by IndiaScoops.com, among political experts, political observers, journalists and representatives of political parties across India, it has come to light that the Mukesh Ambani-led Reliance Group would donate or contribute an estimated Rs 1200 crore to the BJP coffers  via electoral bonds and in kind (or barter), in the coming 12 months in a run-up to Elections 2019.

IndiaScoops.com spoke to over 100 experts and knowledgeable sources nationwide to arrive at these estimated figures.

Not all this money will go directly in cash, about 60 per cent of it will be contributed in kind or barter. (airplanes, air tickets, vehicles, hotel stay, laptops, mobile phones, computers, etc.,)

prashant-bhushan
Senior counsel of the Supreme Court of India and RTI & PIL activist, Prashant Bhushan concurs with the figures arrived at by IndiaScoops.com, claiming that it is very likely that such amounts could be donated by the Reliance Group towards the BJP election expenses for 2019.

Several senior politicians from various parties across India, spoke to IndiaScoops.com off the record for this story.

Many politicians were unable to arrive at a definite figure. It is not possible to put a figure to the contribution of the Reliance Group to the BJP party as a majority of the contribution is in kind in terms of election hardware support. The cash contribution may be in the range of Rs 300 to Rs 500 crore. But the barter contribution cannot be estimated easily. This is never billed and is always written off as PR expenses. Hence, not even they (Mukesh Ambani) would have an exact figure of what amount was sponsored in kind, said a senior Congress politician from Delhi.

However, senior counsel (Supreme Court), activist and founder member of India Against Corruption, Prashant Bhushan was most evocative on the subject.  Prashant Bhushan supporting the above figure of Rs 1200 crore said:

Given the amount that the BJP government has enriched Reliance (both the brothers), through its policies and decisions, I wouldn’t be surprised if the Ambani brothers give over a thousand crore to the BJP government through electoral bonds which is a non-transparent way of funding and giving kickbacks. Of course, large amounts running into thousands of crores could also be given in cash or in kind.

Senior advocate Prashant Bhushan was very clear that the Reliance Group, including both separate entities led by brothers Mukesh Ambani and Anil Ambani have received great largesse from the Narendra Modi-led BJP government at the Centre. “It will  not be surprising at all, if these companies contribute over a 1000 crore to the party’s election expenses. It is not difficult for such a large organisation to even make huge payments in cash over a period of time,” Bhushan elaborated.

IndiaScoops.com has learnt that in fact a substantial amount will be paid from the Reliance Group companies or associates abroad. This money would never come to the BJP directly, but would be used to fund election expenses from overseas. 

A senior AAP (Aam Aadmi Party) leader from Delhi who preferred to remain anonymous told IndiaScoops.com that Rs 1000 crore is just small change for the Ambani brothers put together. He said:

“I am surprised that you have arrived at this figure. I was expecting it to be in the range of Rs 1500-1700 crore at the least over a 12 month period, prior to election time,” he said, adding that given the huge defense contracts the Ambani firms have bagged without much prior experience in the defense sector, the ‘donation’ to the government could be even as high as Rs 2000 crore.”

According to media reports, data from the Finance Ministry, given in response to a Right to Information (RTI) request by BusinessLine, a total of 905 electoral bonds have been issued for a cumulative value of Rs 438.3 crore across three tranches. Data for the fourth phase of electoral bonds’ sale scheduled to be held from July 2 to July 11, 2018 is not known.

The Rs 1200-crore figure, though arrived at after a lot of research and after speaking to several knowledgeable sources, is at best speculative in nature, given the fact that no official information is available anywhere, and data submitted to the Election Commission of India, by political parties is grossly incorrect.

Reliance Group spokespersons refused to speak to IndiaScoops.com on the subject and the Rs 1200 cr figure remains at best estimated or speculative – it could be far more, but at any cost is not likely to be any lesser, which means these are minimum or conservative figures, never-the-less, it is an indicator for the common man of the kind of funding the BJP party is likely to receive over the next one year from corporates alone.

Other political parties put together won’t even get a 10th of the amount from the Reliance Group, our research indicates.

According to an Economic Times report dated 17th March 2018, in the first issue of Electoral Bonds, Rs 222 crore of bonds were bought to make donations to political parties. The issue opened for subscription for 10 days on March 1.

Since these transactions by nature are almost anonymous it is impossible to detect who purchased these bonds, and more so who are the ultimate beneficiaries of the Rs 222 crore. However, political experts and knowledgeable sources claim that the Reliance Group through its subsidiaries purchased almost Rs 250 crore of Electoral Bonds in the last three issues from March to June and almost Rs 150 crore was purchased in the first tranche in March 2018. This purchase would also give the company a proportionate tax exemption for the previous financial year as the purchase and donation would be shown in the books of accounts of the previous financial year.

According to an India Today report dated 21st June 2018, the much hyped Modi Government’s electoral funding reform is skewed, to cash-starve the opposition parties, particularly the Congress and smaller regional parties. Out of a total of 11 centers for sale of electoral bonds, to donate funds to the political parties, seven are in states with BJP Governments. Six out of seven new centers opened in April are in BJP ruled states, reports India Today.

The Bengaluru center opened in April issued bonds worth Rs 38 crores just ahead of the Karnataka assembly polls. The Congress party had hit out at the Modi government and alleged that the BJP opened centers in state captials where the BJP is in power and ignored cities like Hyderabad & Patna. Under the new scheme, name of the beneficiary party cannot be made public, reports India Today.

Banks Refuse to Disclose Buyer Details   

In response to RTI queries, the State Bank of India has refused to disclose details of buyers of the electoral bonds, political parties which have redeemed these and the bank’s reports sent to the government on their sales, calling it personal information held by it in fiduciary capacity exempted from disclosure, an RTI response showed, claims a PTI report dated 28th June 2018.

The details provided by the bank shows that in March 2018, it sold bonds worth over Rs 222 crore, while in April the number dipped to Rs 114.9 crore.

Mumbai saw the most enthusiasm among donors to purchase electoral bonds says the PTI report, with Rs 122 crore of bonds being sold from the SBI’s main branch in the maximum city. In April the sales stood at Rs 53 crore, it said.

Activist Venkatesh Nayak, who filed the RTI application, contested the response of the SBI stating that denial of information about buyers of electoral bonds and receiving political parties is “patently erroneous”.

“The CPIO is treating both the buyers of EBs (electoral bonds) and the political parties as being in a ‘fiduciary relationship’ with SBI! This is in complete violation of the master circular issued by the Reserve Bank of India regarding the basis of customer confidentiality. Para #25 of the July 2015 Master Circular,” he said.

“The amount collected from the sale of Electoral Bonds under the first issue of the scheme is Rs 222 crore as on March 9, 2018,” minister of state for finance P Radhakrishnan had said in a written reply in the Lok Sabha.

Criticizing the move, senior advocate Prashant Bhushan had said “Instead of introducing a cashless system in electoral funding to track donations and expenditure, the Centre has done the exact opposite,” Bhushan said at a programme on “Political Corruption and Dangers to Democracy”, organised by Swaraj Abhiyan and Jana Sangrama Parishat, as reported by the Economic Times on 26th March 2018. Bhushan claims the system of Electoral Bonds only adds to corruption and benefits only one political party – the BJP.

What the experts say?

Former Chief Election Commissioner S Y Quraishi spoke out against electoral bonds, warning they would lead to capitalists running the country.

“I used to say that any reform is a good reform. But, I have my reservations about it now. One reform which was done recently is very, very destructive. Electoral bonds have been introduced….Crores of rupees paid by companies: you will not get to know who has given money to whom. Now, that is not transparency,” Quraishi was quoted by The Hindu in a report dated 3rd July 2018.

According to an India Today report dated 21st June 2018, RTI information for the first three months show that maximum funds came from Mumbai (Rs 213 Cr), the commercial capital of the country where most corporates are based. Among the other top donor cities are- Delhi (Rs 73.6 Cr), Kolkata (Rs 70.0 Cr), Bengaluru (Rs 51.8 Cr), Chennai (Rs 18.0 Cr) and Gandhinagar (Rs 12.0 Cr). Out of Rs 51.8 Crores, Bengaluru got Rs 38.9 Cr in the month of May during Assembly polls. Among the seven centers introduced in phase three, bonds were purchased only in Bengaluru and Gandhinagar. Not a single bond was purchased in five other state capitals ruled by the BJP so far. To en-cash the tax benefits a total of 520 electoral bonds worth Rs 222 crore in value were sold in March alone. In April, only 256 bonds of Rs 114.9 crore in value were sold while in May only 204 bonds worth Rs 101.4 crore were sold.

During 2016-17, the BJP alone received Rs 290.22 crore or 89.22 per cent of the total donations to political parties from Electoral Trusts formed to facilitate donations to political parties says the India Today report. To which political party funds donated through electoral bonds went to, will now be a closely guarded secret and the information is not available through RTI.

Electoral bonds increase anonymity and do not enhance transparency in any manner, there is another equally important issue of unbridled government control over the selection of cities where the bonds would be available for purchase claims a post in Factly.in.

Since the electoral bonds have to be purchased/collected by physically visiting the designated SBI bank branch, it is highly impossible for someone in the states of Kerala, Andhra Pradesh, Telangana, Odisha, Jharkhand, Chhattisgarh, Bihar, Himachal Pradesh, Uttarakhand, Jammu & Kashmir and Goa to purchase the electoral bonds since no SBI branch is authorized to sell electoral bonds in these states. In other words, citizens & other entities in these 11 states are being kept out of this scheme. It has to be noted that regional parties are ruling some of these states and they are at a great disadvantage, claims a post in Factly.in.

Violation of the scheme guidelines

When the scheme was notified in January this year, the guidelines mentioned that the bonds would be available for purchase for 10 days each in the months of January, April , July & October. But in 2018, the bonds were available for purchase for 10 days each in the months of March, April, May and July. The months of March & May were not mentioned in the original notification. Though the central government can specify an additional period of 30 days, that can be done only in the year when the Lok Sabha elections are due i.e., 2019 and not in the current year (2018), claims a post in Factly.in.

‘Software updation’ – the reason for not extending this to other cities

In response to an RTI application that sought the reasons for not extending the electoral bonds to SBI branches in the rest of the states, the Department of Economic Affairs, Government of India mentioned ‘Software Updation/Modification’ as the reason for not extending the scheme to all the cities claims a report in Factly.in.

There are two basic questions that remain unanswered in this age of technology. Why would updation/modification of software take so many months and why is updation/modification of software city specific?

Such flimsy reasons give credence to the belief that the Central government is intentionally keeping certain states/cities out of the scheme, claims Factly.in.

What are Electoral Bonds?

An electoral bond is designed to be a bearer instrument like a Promissory Note — in effect, it will be similar to a bank note that is payable to the bearer on demand and free of interest. It can be purchased by any citizen of India or a body incorporated in India, says The Hindu.

How do you use it?

The bonds will be issued in multiples of Rs 1,000, Rs 10,000,  Rs 1 lakh, Rs 10 lakh and  Rs 1 crore and will be available at specified branches of State Bank of India. They can be bought by the donor with a KYC- compliant account. Donors can donate the bonds to their party of choice which can then be cashed in via the party’s verified account within 15 days.

What are the other conditions?

Every party that is registered under section 29A of the Representation of the
Peoples Act, 1951 (43 of 1951) and has secured at least one per cent of the votes polled in the most recent Lok Sabha or State election will be allotted a verified account by the Election Commission of India. Electoral bond transactions can be made only via this account.

The bonds will be available for purchase for a period of 10 days each in the beginning of every quarter, i.e. in January, April, July and October as specified by the Central Government. An additional period of 30 days shall be specified by the Central Government in the year of Lok Sabha elections.

As explained by finance minister Arun Jaitley, the electoral bonds will not bear the name of the donor. In essence, the donor and the party details will be available with the bank, but the political party might not be aware of who the donor is. The intention is to ensure that all the donations made to a party will be accounted for in the balance sheets without exposing the donor details to the public.

According to a report in Live Mint/PTI, dated 6th February 2018, there is no
plan as yet to make Aadhaar mandatory for donors under the electoral bonds scheme, which is aimed at cleansing the system of political funding, the government has informed the Lok Sabha. The government had notified the scheme on 2 January.

“There is no proposal currently to make the use of Aadhaar” mandatory under the scheme, Jaitley had said in a written reply in the Lok Sabha on 2 February 2018.

Will Electoral Bonds be tax deductible?

During the Budget presentation in February 2017, the Finance Minister had proposed that the maximum amount of cash donation that a political party can receive be capped at ?2,000 and that parties be entitled to receive donations by cheque or digital mode, in addition to electoral bonds.

In a press conference that followed, he had added that donations would be tax deductible. “A donor will get a deduction and the recipient, or the political party, will get tax exemption, provided returns are filed by the political party,” said Jaitley.

(This post is the first part of a 2-article series. The second post will be published next week)

Editor’s Note: This is a developing story. This post will be updated as inputs come in. Many people whom IndiaScoops.com spoke to are yet to revert to us with their feedback. You can send us your feedback and inputs on indiascoops AT gmail.com. We welcome suggestions and data from members of the public. We regret that we cannot individually reply to your emails or queries.