Why not sell the Taj, when we can do it with Mumbai airport?


Have you recently heard any jokes about selling Taj Mahal to foreign tourists? No? Not lately?

That is because people don’t joke about that nowadays. Reason: you can almost do it now. Sell the Taj, that is.

Here’s how. First, call it a public private participation (PPP) initiative; next, put the Taj into a separate corporate vehicle; third, sell a majority stake in it and tell the public to mind its own business. Who can object, for it is a public-private initiative, where the public is upfront, and private comes next?

Without a clearcut PPP policy and without regular audits by the Comptroller and Auditor General (CAG), India’s public property is being carved up and sold like paneer. The sale of assets is couched in PPP terminology like modernization of infrastructure, special purpose vehicles, etc.

This is how the Mumbai and Delhi airports have been sold to private parties without calling it sale of public property. But that happened several years ago under UPA-1. In any case, the idea of PPP can be theoretically defended as an effort to rope in private investment for public causes. The problem lies in what PPPs have come to mean: keeping the public out.

What has now transpired is that the public can be locked out of any information on what is going on at these PPPs. Even if the courts tell Mumbai airport to answer RTI queries, it can stonewall and keep the public out. PPPs are now only about staying private. There is no “public” spirit left in them.

But before we get to Mumbai airport, let’s look at how these things are done.

Let’s say we want to convert Mumbai’s Chhattrapati Shivaji Terminus (CST) railway station into Lalu Yadav Railway Station.

It hasn’t happened yet. But consider this scenario three years hence. The year is 2015. Patna-based Lalu Yadav & Sons Ltd (LYSL), in collaboration with a consultant company called Pirates of Somalia Ltd, newly registered in Mauritius, takes over CST in Mumbai. The railway ministry transfers CST’s heritage building and all surrounding railway lands to LYSL on a 30-year lease for only Rs 100 per year. LYSL in turn transfers this land to a subsidiary company. This subsidiary company uses it as security to take an “infrastructure loan” of thousands of crores from a consortium of public sector banks. Hotels and commercial spaces start sprouting on railway land. Pirates of Somalia Ltd periodically sends technical consultants who freely travel throughout the railway system, and nobody has the authority to question them, not even the railway ministry.

Worried about national security and public property, citizens file RTI applications questioning this activity. Lalu Yadav & Sons says, “We are not part of the government, and so we are not under RTI. We are a private company, this is a private for-profit activity.”

Central Railway, which owned CST before the PP came up, and the Union Railway Ministry don’t answer queries, saying that only  Lalu Yadav & Sons has the answers. Finally, in 2016, Chhatrapati Shivaji Terminus is officially renamed as ‘Lalu Yadav Railway Station’.

Is this a far-fetched scenario?

Now consider another scenario: ‘GVK Reddy Airport in Mumbai’

True or false? True. It has already happened. Except for the renaming, everything else mentioned in the previous scenario has already happened to Mumbai’s Chhattrapati Shivaji International Airport (CSIA). Mumbai’s airport has been the private ‘jagir’ of GVK Reddy for four or five years now. While the UPA government seems happy with this situation, the common man is fighting in court.

The Airports Authority of India (AAI) has a 26 percent stake, and GVK Airport Holdings Pvt Ltd holds about 51 percent in a consortium called Mumbai International Airport Limited (MIAL). The remaining 23 percent shares are held by two ‘khokha’ companies registered in Mauritius, whose relationship with two similar-sounding South African infrastructure companies is being actively concealed by the government of India. In GVK’s annual reports, MIAL is called an “associate company”.

The language of the annual reports indicates that the accounting treatment of MIAL is like a GVK Group subsidiary company rather than as a public-private entity in which GVK is a majority private sector partner.

While enjoying 2,000 acres of AAI land for a lease rent of Rs 100 per annum, and paying ridiculously low income tax and service tax of around Rs 3,000, GVK claims the freedom to act as if it is just another private limited company working to maximise profits. It is running MIAL in collaboration with the two ‘khokha’ companies – namely ACSA Global Ltd and Bid Services (Mauritius) Ltd – which have shadowy links to the companies that were evaluated by AAI and found worthy to be partners in the MIAL Consortium, namely Airports Company South Africa and Bidvest of South Africa.

The common man who asks questions to MIAL is being stonewalled. See MIAL’s reply to Sanjay Shirodkar’s RTI application.

In June 2008, the Bombay High Court ruled that MIAL is an instrumentality of the ‘state’. But GVK still refuses to adopt standards of transparent dealing that come with being an instrumentality of the state, and a custodian of state properties. What is alarming is that the Indian government is quietly playing along with GVK.

To shield GVK and the ‘khokha’ companies, even public authorities such as AAI, the aviation ministry, the finance ministry, the Airports Economic Regulatory Authority (AERA), the Planning Commission and other government bodies that are privy to MIAL’s dealings are continually evading RTI queries. No government agency wants to disclose anything. See Sanjay Shirodkar’s many RTI Applications and the evasive replies received.

A consortium of banks, most of them in the public sector, gave an infrastructure loan of Rs 4,200 crore to MIAL. Whose money? Yours and mine. But the details are being concealed by the banks. In a worryingly perverse order, Central Information Commissioner Shailesh Gandhi opined that it was a matter of “commercial confidence and fiduciary relationship” between the banks and the borrower, and there was no public interest in our knowing about it.

How GVK is abusing judicial process to cause delays

The question of whether MIAL is a public authority (i.e. answerable under RTI Act 2005) was decided by Bombay High Court in Writ Petition No. 617 Of 2007. The judgement dated 5 June 2008 said, “the issues which arise for consideration in the present Writ Petition are: (i) Whether the Respondent No 3 company, MIAL, is ‘state’ within the meaning of Article 12?”

On page 170 and 171 of the judgement, after lengthy reasoning, Bombay High Court concluded, “It is because Respondent No 3 performs governmental functions that… it can just like government use a summary procedure to evict unauthorised occupants on the area leased to it without following the rigour of the Rent Act. This shows unmistakably that Respondent No 3 is “state” for the purpose of Article 12.” Read highlighted portions of Bombay High Court judgement dated 5th June 2008.

The question of whether MIAL was a public authority as per RTI (which is the same as being “state” under Article 12 of the Constitution) was simultaneously considered and answered by the Central Information Commission in June 2008. The CIC ruled that MIAL, like its counterpart DIAL (Delhi International Airport Ltd), is a public authority, and therefore directed it to furnish the information requested under RTI.

But MIAL did not want to comply. As this matter had already been decided by Bombay High Court, MIAL did not have the option to appeal before the Bombay High Court. So it went to the Delhi High Court and pleaded that its submissions had not been heard by CIC. (This unlawful behavior is called forum-shopping – actively seeking a court that might give a favourable judgment.)

The Delhi High Court asked CIC to rehear the case. CIC heard the case again and gave the verdict that MIAL is definitely a public authority as per section 2(h) and, therefore, it must give information requested under RTI. Read the CIC order dated 30 May 2011.

MIAL, still determined to not provide information, filed yet another fresh petition before the Delhi High Court. To avoid being held accountable as a ‘state’ as per the Bombay High Court judgment, MIAL is now dragging on this case in the Supreme Court.

In this way, MIAL, or rather GVK Group, has built up a mass of 15 litigations before the Supreme Court alone, causing confusion and maintaining the status quo.

Why is everyone silent on this blatant stonewalling?

The interesting thing is that even while the Congress-led government – which handed over the airport to GVK – may have its own reasons to cover-up what MIAL is upto, the opposition parties seem to be willing to let things be.

But it’s clear that a twisted logic operates in PPP: On the one hand, the government gives the private partner public resources worth thousands of crores, ostensibly because the private partner is supposedly maintaining a piece of public infrastructure. On the other hand, the private partner is free to avoid being questioned and to seek undue profits as he argues (and the government agrees) that this is a private activity. How can building and maintaining public infrastructure be a private activity? How can any such information be ‘private’ or ‘confidential’?

Don’t ask, because this twisted logic is an accepted part of PPP projects.

So, let’ sell the Taj under PPP.

(Krishnaraj Rao is an RTI activist. The opinions expressed by the author and those providing comments are theirs alone, and do not reflect the opinions of Canary Trap. This post was first published on Firstpost on June 12, 2012)

Nyoma incident: Have Maoists infiltrated the Indian Army?


The recent upheaval in an artillery unit (226 field regiment) in Nyoma in Ladakh sector is not merely a rupture of officer-men binding. In the past, the underlying impetus to such upheaval was religious or ethnic ferment amongst the troops, but in the instant case “class clash” is being insinuated by certain quarters, specially the media. The character that the  upheaval acquired after the initial spark has typically ultra-leftist footprints. Reportedly, when the  Divisional Commander visited the unit to take stock of the situation the next day he found  that  no personnel was wearing his rank on shoulders or arms. When questioned, they with temerity said that they had repudiated all rank structure and they were all ‘jawans’.

The disturbing question is that as in the case of para-military forces have the Maoists started infiltrating and subverting the Indian Army? The over-ground Maoists, particularly those in the media, have in the recent times been drumming invidious, absolutely factious and outrageous propaganda that the Indian State, ‘as part of its war of attrition on the poor has pitted poor jawans in police and para-military forces against poor-Maoists’. In this propaganda the ‘officers’ are labeled as agents of the State. In a seminar organized by a thinktank associated with ‘profession of arms’, the editor of an English Weekly unabashedly and with impunity, unleashed this propaganda war in the presence of uniformed personnel.

The incident therefore should be of pernicious concern for its egregious portents and ramifications. It undermines the very foundations of the Indian Army. All armies, in fact all Nation-States draw their strength from accountability at various levels predicated on hierarchy. In the Army it is called ‘chain of command’ whose sanctity if attacked leads to anarchy.

Organised Rebellion

There are any number of versions of the said incident, each adducing more serious motive and breach than the other. Nevertheless, it definitely emerges that after the immediate trigger, which involved criminal transgression on the modesty of an officer’s wife, the spontaneity factor had soon given way to planned, meditated and organized rebellion and violence. At least two newspapers reported that violence had spilled on the streets of Nyoma village and the troops had degenerated into a bloodthirsty mob, raising slogans on megaphone all through the night. Above all, the matter of gravest concern is the dissolution of all intervening levels in the organizational and leadership hierarchy between officers and men i.e. JCOs and NCOs. As in the case of Kargil conflict the role and efficacy of JCOs beggars drastic review. Whether this violence is mutiny or near-mutiny is not the question. The critical issue is that the most vital ‘officer- men’ link, which welds a unit, snapped. It is never sudden or episodic but is result of constant fraying.

Officer-Men Relationship

This rupture in ‘Officer-Men relationship’ such as in 1857 and 1984 is rare  phenomenon. More recently it also happened in Bangladesh, wherein the Bangladesh Rifles, the para-military force responsible for security of Indo-Bangladesh border, mutinied against their officers, essentially drawn from the Bangladesh Army. In each of these upheavals, it was not the case that officers were responsible, or all the subordinates were consumed by the unmitigated passion of revenge against the officers, but such was the threat and compulsion of the instigators that they had no option but to associate themselves. Both in 1857 and 1984, the rebellion was against the ruling dispensation and the officers were targeted primarily because they were seen as stymie which is the sacred duty of officers no matter how overwhelming the opposition and how heavy the price.

The Element of Subversion

Such upheavals in the Army are seldom without sustained subversion of men. The 1857 upheaval, call it ‘mutiny’ or ‘war of independence’, was preceded by the bizarre ‘chappati movement’, wherein unleavened bread spread like wild-fire throughout the subcontinent. Since the ‘chappatis’ did not bear or carry any message, the objective of this movement elicited a wide range of eerie and inauspicious interpretations. The native troops in the cantonments were greatly disquieted by these interpretations, which did evoke suspicion about the British and the British Officers. The 1857 upheaval as is well known had religious underpinnings. So was the case in 1984. It is also established that the ethnic and religious subversion began to be implanted by the ISI through some self-styled leaders of the Sikh community settled abroad. Similarly, the recent mutiny in Bangladesh Rifles was engineered by the ISI in collusion with Islamic fundamentalists, who were disconcerted with the ascendance of Sheikh Hasina, as the Prime Minister of Bangladesh. The objective of powers, which were behind this mutiny was regime change by assassinating Sheikh Hasina.

The China Factor

The involvement of inimical powers, organizations and agencies is more often than not implicit in such incidents. The place of the incident, Nyoma, has the recently constructed strategic airfield. Subversion of a few personnel of the unit through internal agents by agencies inimical to India cannot be ruled out. It is also possible that some personnel of this unit which has an All India Composition may have been indoctrinated in violent ideologies even before joining. This phenomenon can hardly been denied in the police forces of previously communist ruled states as also Maoist infested states. Even the bureaucracy does not remain unaffected. The  Army too draws its men from the same stock. Mao too had infiltrated communists in the nationalist forces who caused considerable subversion.

On the Eastern frontiers, Maoists are making fast inroads into Arunachal Pradesh. This is corroborated by the MHA reports based on arrests and interrogations of some Maoist recruits in Assam-Arunachal border. It is also confirmed that the anti-dam protests in the Dibang Valley has a Maoist bias and is serving a fertile recruitment ground. Some of the Maoist cadres apprehended by the security forces were armed with AK-47s. There are already reports about the emerging linkages between Maoists – insurgents in the Northeast & Myanmar–ISI–China. The ISI is known to be reaching out to the Maoists through various jihadi organizations based in Bangladesh.

It can therefore be inferred that the China, directly or through its proxies, would be aggressively engaged in subverting and compromising Indian defence set-up in the Ladakh sector wherein its vital road through the occupied Aksai Chin passes.

Indian plans to raise a Strike Corps for the Mountains, construction of new airfields in vicinity of the Indo-Tibet border, and Indian maritime posturing in the Indian Ocean and South China Sea has  surely unnerved China.

China therefore is employing every method to keep India, particularly in the border regions, disturbed and unsettled. Its leveraging of insurgent groups in the North-East and Maoists is no longer subtle but brazen as in the  60s and70s .The border regions of India are full of cross-border operatives.

Invidious Agendas

It requires only few potential mischief makers to be subverted, who then use propaganda to implant prejudices in innocent and unsuspecting.

Invariably, the inimical powers and agencies have a segment of the press of the very target country working at their behest. It was rather intriguing that a segment of the press instead of evincing patriotic concern on the unfortunate incident involving ‘their own’ Indian Army found it opportune to flog extraneous and factious insinuations and propaganda. As a faithful communist propaganda machine, one newspaper known for its pro-China predilections attributed the incident to ‘class-tensions’.

In one television debate, the motive to circumscribe the proceedings within the parameters of mischievously posited themes, i.e. system of sevadars in the Army, feudal nature of the Indian Army, class disparity between officers and men, and the unpopularity of Army as a profession amongst the youth, was clearly discernible.

With great labour one panelist sought to dispel the amnesia about the Kargil conflict, wherein the same young officers who were being labeled as ‘feudal’ and high-headed led the most tenacious assaults unparalleled in the history of mountain warfare, fully conscious of the nearly certain death that stared at them in the Kargil conflict. The list of casualties bear impeachable testimony. It is also a testimony to the character building and training of officers in the Indian Army. Young officers are the firmament of camaraderie in the Army.

With regard to pay disparity it emerged in the debate that the difference in pay between officers and men had narrowed down from 1:15 to 1:3 or1:4 at entry levels over the years since Independence. Consequent to the 6th Pay Commission a jawan, on joining the Army, is straight away propelled, if not into the middle class then at least into the lower middle class category. Also the hackneyed notion about youth not wanting to join the armed forces is totally misplaced. The response is not poor at all. On an average one lakh candidates appear for each NDA course. In terms of applicant to post ratio 431 candidates applied for each NDA vacancy whereas the corresponding number for combined civil services was only 319.

Also it is neither a status-quo, nor conservative nor vested truism that the choice is not between servants and sewadars, but it is between battle-worthy helpers and no helpers at all. In the field areas and in war the sewadar is like a buddy. In Siachen glacier I and my sewadar shared the same tent. He also functioned as the radio-operator. Several nights we spent holding the tent pole under unsparing and furious assault of blizzards. In terms of professional physical and mental activity an officer is not expected to demand what he cannot demonstrate with certain degree of superiority. An IPS officer was captured by the media being carried on the shoulders of a constable during the floods in Gujarat. In the Army this would be construed not only a disgraceful conduct but would have invited court-martial as well. On the contrary, if an Army officer had done the opposite he would have been lauded. The whole sewadar debate is unfortunately being portrayed through the prism of class and antiquated colonial ideas about racial or class divide. Today a sizable chunk of officers are sons of JCOs and NCOs. In the profession of arms and the current  sociological context in the Indian Army, dignity of labour is acquiring different and laudable connotations, something to be replicated by rest of the country. Even as the sociology in Army is rapidly evolving, the Army as an institution, on its own volition, is cogently addressing the issue in all its dimensions.

Inimical forces are always sensing opportunities to drive wedges within the ranks of the security forces. One such force is the Maoists which enjoy indulgent patronage of not only China but also ultra-leftist and some Church organizations in the West. Imperceptible and indirect infiltration of such elements in this ignominious artillery unit cannot be ruled out. The Maoist leadership unabashedly stated its plans of infiltrating security forces. As in the case of this artillery unit, units without fixed composition are more vulnerable to such infiltration. On the other hand in units with fixed composition, ethnic pride and values serves as a robust bulwark against subversion.


This sleazy and notorious ‘class clash’ discourse with regard to the Indian Army needs to be nipped in the bud and to ensure that it does not even remotely become contagious all  those who were in criminal defiance of the chain of command and those who abandoned command responsibilities in crisis should be ruthlessly punished and then dismissed from service. The unit should be consigned to the dustbin of history. The Army after all is the final guarantor of the territorial and psychological integrity of the country.

(RSN Singh is a former military intelligence officer who later served in the Research & Analysis Wing. The author of two books: Asian Strategic and Military Perspective and Military Factor in Pakistan, he is also a guest blogger for Canary Trap. This post was first published on Firstpost on May 22, 2012)

Change text books to charm Dalit vote bank


There is a saying in Hindi: Apna khana, apna gaana. In other words, we can transcend habits picked up from our childhood, except the ones concerning food and music. To these add one more: humour. True, humour can be universal, but a great deal of it is extremely parochial, conditioned by local inflections and attitudes.

The first Christmas programme I saw in London in the 60s is etched on my mind. A pair of polka-dotted panties cover the screen. A voice asks: “You’d wonder what these have to do with Christmas?” Pause. “Well, these are Carol’s”. Canned laughter. The pun on Christmas carols and Carol’s panties was supposed to induce laughter. It didn’t, in me.

In fact, the doggerel that followed left me worried that all reserves of humour in me had probably dried up:
“If every day was Christmas
By some fantastic trick,
If every day was Christmas
We’d all be bloody sick”

Here was British irreverence in the swinging 60s. But would the BBC risk such humour, say, in Northern Ireland, when just about this period, Terence O’Neill had resigned as the Protestant Prime Minister of Northern Ireland? BBC offices would have been gutted by Catholics and Protestants with equal fervour.

Nor would this humour go down well in the Bible belt of the American south or the varied Christian enclaves of India stretching from Kerala to the North East. In other words, Christmas, a day of universal festivities, is treated with varying shades of reverence by segments of the Christian church spread across the globe.

Irreverence, it turns out, is an essential ingredient in humour. And yet the capacity to cope with irreverence varies from culture to culture, class to class.

Every time the late M.G. Ramachandran fell ill, with high fever, a number of people immolated themselves. What to me was apotheosis of the bogus was to MGR’s fans a simple deification of the sublime. Even criticism of MGR’s government would result in government advertisements being withdrawn from my newspaper. Publish cartoons lampooning MGR in Tamil Nadu and the state would break out in a riot.

There is tremendous wit and humour, quip and repartee in Tamil. But the Dravida movement, of which MGR, his guru Annadurai, contemporary K. Karunanidhi, were all leaders, had just emerged from the shadows of Brahmin domination. It had not yet developed the self confidence for self deprecating humour in the presence of its former tormentors. A lampoon in a non Dravida publication would register as an insult, a deliberate desire to put down the Dravida.

The emancipation of the Dalit is an even more recent phenomenon in North India. Hence the inability to stomach any comical casting of the solitary Dalit icon, B.R. Ambedkar.

The question, of course, is why this hullabaloo about a cartoon published 63 years ago? Because that was prior to Dalit emancipation, when Ambedkar was not seen in sectarian terms but rather as a brilliant author of India’s constitution. It just so happened that he had the origins of a Dalit.

There is another fact we tend to lose sight of. Democracy in a society shackled for generations in a triple hierarchy of feudalism, classes brought about by Macaulay’s education policies and a millennia old varna systems or caste structure, is compulsorily accompanied by egalitarianism. The Dalit who 63 years ago had no voice, is today a muscular electoral presence.

The Dalit who had to be careful not to let his shadow fall on the upper castes six decades ago, has today been able to create an icon he worships. The need for the icon will decline in direct proportion to the creation of a coherent Dalit elite. But until that phase of its evolution, the group will reserve the right to throw a ginger fit at any hint of its icon being laughed at.

The surprise is not at Dalit unease, but at UPA stalwarts vying with each other to drop cartoons from NCERT text books. This is attributable to one fact: a state of funk after the recent election results.

The release of Mushirul Hasan’s Pickings from Parsee Punch was almost custom made for a situation in which cartoons are an issue. Parsee Punch is essentially a sectarian replica of the Awadh Punch which derived from the Punch of London. Punch represented the highest level of British wit and satire, replete as it was with some of the greatest cartoons and satirical writings. The sophisticated elite of Lucknow paid the British back in their coin.

Instead of pelting stones at the British, the elite of Awadh (Oudh), who in their sophistication, style and diction, remain unparalleled, borrowed the title of London’s Punch to create a platform to attack the British. They published from mid 19th century to early 20th century the Awadh Punch in which poets like Akbar Allahabadi wrote their finest satire.

Here was a level of sophistication where even God and his abode were not spared:
“Sidharen Sheikh Kaabê ko
Hum Inglistan dekhenge.
Who dekhen ghar khuda ka
Ham khuda ki shaan dekhenge!”

(Let the Sheikh proceed to Mecca. I shall leave for London. Let him see the House of God. I shall see His wonders!) The spoof is on both, the Mullah as well as the new London crazy elite.

A great deal of the humour of Awadh Punch was distinctly elitist, meant for what Sir Sayyid Ahmad called the “Ashraf” or elite.

In fact those outside the pale were also a butt of Awadh Punch humour:
“Council mein bahut Saiyid
Masjid mein faqat jumman”

(The viceroy’s executive council is full of high caste Saiyyids and the mosques are full of Jumman, a disparaging name for the caste of weavers). If only the authors of Awadh Punch were around today they would rue the day they ignored the Jumman, who has pushed the “Ashraf” into the Margins. Indeed, in communal politics he calls the shots today.

(Saeed Naqvi is senior Indian journalist, television commentator, interviewer, and a Distinguished Fellow at Observer Research Foundation. Mr. Naqvi is also a mentor and a guest blogger with Canary Trap)

Appointment of CICs and Sushma Swaraj


Documents procured by activists Girish Mittal and Lokesh Batra under the Right to Information (RTI) indicate that the latest batch of Central Information Commissioners (Rajiv Mathur, Vijai Sharma and Basant Seth) were selected by a more transparent process than selections of the past.

The central government has definitely mended its ways and set a good precedent for state governments. By calling for applications and having applications screened by a Search Committee, the government has yielded to two long standing demands of RTI activists.

However, it appears that Leader of Opposition Sushma Swaraj short-circuited the process. She put up two names that were not selected by the Search Committee, and one of them became a CIC. New CICs Rajiv Mathur and Vijai Sharma were on a shortlist of nine persons after a screening process for 214 contenders. But new CIC Basant Seth was eliminated by the Search Committee, and re-entered the shortlist as Sushma Swaraj’s candidate, documents acquired through RTI suggests.

Process followed this time:

Documents mentioned below will be able to throw more light on the selection process.

  • Copies of all correspondence between DOPT and PMO concerning constituting Search Committee, defining its terms of reference, etc.
  • Copies of documents showing the criteria and procedure used by the Search Committee for screening the 214 names and arriving at the shortlist of nine names.
  • What inputs were solicited and received by the PMO, Selection Committee and/or Screening Committee from IB and CVC? Copies of all correspondence, reports received etc.
  • Copies of all correspondence by Opposition Leader Sushma Swaraj with PMO, Search Committee, Selection Committee and candidates for the CIC’s post.

Notwithstanding possible deficiencies of the process followed in this round of selections, it is far better than earlier selections when A N Tiwari (now retired) and Satyananda Mishra (now the Chief CIC), who were both DoPT Secretaries, selected themselves for the post of Information Commissioner. Tiwari and Mishra disregarded dozens of applications addressed to them and made the shortlist list so short that it reduced the Prime Minister’s Selection Committee into a mere rubber stamp. (Click here to understand ethical and legal issues in selecting CICs)

The present changes in selection procedure are the result of an ongoing struggle since 2009. (Click here to read background info on this)

More Resources:

(Krishnaraj Rao is an RTI activist. The opinions expressed by the author and those providing comments are theirs alone, and do not reflect the opinions of Canary Trap)

Questions on GoI-Vodafone tax dispute


For the umpteenth time, Karan Thapar, on his TV show The Last Word, was bashing the government on the Vodafone tax issue. This time (May 9, 2012) he had four guests having similar views and each guest was trying to outdo the other on the unfairness of the retrospective amendment and the grave consequences on FDI etc.

By now, one thought, Mr Thapar would have known that a good interview is one where the interviewer asks the right questions but somehow he never gets around to asking the right questions. So here is a list of questions on the Vodafone deal involving Rs 11,000 crores plus of public money that Mr Thapar will never ask. The answer to the question is in the question itself.

  • Is there a saving clause in the Vodafone-Hutch agreement that states that if Vodafone is made to pay the income tax on the Rs 45,000 crores gain made by Hutch, then Hutch will indemnify Vodafone for it? It is a clause that even a first year law intern will not miss.
  • Is it possible to believe that the lawyers who were paid multi-million dollar fees by Vodafone failed to insert the saving clause?
  • Is it not true that Hutch has been following the Vodafone case in the Supreme Court through its representatives? If, yes then why?
  • Its never been written about so far, but something that would be of intrigue to a lot of Vodafone case observers. From Day 1 of the dispute, in Bombay HC to the SC hearings underway, Hutch representatives have been present in the courtroom. One of them is a foreigner and one an Indian and they are given company in court by their tax advisor in India (one of the Big 4 firms). The Hutch representatives do not sit with Vodafone employees nor are they seen mingling with them (over half a dozen senior Vodafone employees from overseas too are attending the hearing). But they diligently take down notes of the court proceedings and at times do display emotions when some arguments are made.
  • The big billion dollar question then: Is the interest of Hutch in this case merely ‘academic’ or are they liable to reimburse Vodafone in case it loses the case in SC? The existence of a tax deed between Hutch and Vodafone is well known but whether that entitles Vodafone to claim reimbursement of a potential $2 billion tax liability is not too clear. But that discussion is for another day…
  • Why is it then that Vodafone is being made to be shown as innocent victim on whom this huge tax liability has fallen? Is it not true that the ultimate liability will fall on Hutch? Why is the media deliberately promoting the myth of the liability falling on Vodafone?
  • Is it not true that while Hutch, in its initial filing with US regulator, stated that it was selling 52% of the shares to Vodafone in Hutchinson-Essar?
  • Is it not true that Hutch applied for permission from FIPB for sale of 67% of equity?
  • Is it not true that Hutch tried to cover up its 15% benami transaction as indirect equity and that indirect equity is not recognized in Companies Act?
  • Is it not true that Hutch held 15% excess equity through three Indian benamis and was in violation of FDI ceiling of 74% (22% of shares were held as FDI by Essar).
  • Is it not true that this 15% equity was not declared to the Indian authorities earlier?
  • Is it not true that this benami equity of 15% held in India and described as indirect equity too was sold by Hutch to Vodafone for a profit of Rs 9000 crores and no tax paid on it?
  • Is it not true that Hutch paid Rs 1700 crores to Essar group by cheque to get the deal cleared by the Indian authorities and also not to object to the deal?
  • Is it not true that Chidambaram cleared the deal without collecting the tax on it?
  • What would be the fate of Chidambaram, Analjeet Singh and Essar if there was a genuine CGI investigation into the FIPB clearance?
  • Is it not true that Vodafone has been increasing its stake in the indirect equity through gross under-valuation of the value of the shares?
  • Can a poor country like India afford to forgo taxes worth Rs 11000 crores plus on assets held in India?
  • Do the likes of Narayana Murthy and his ilk who are defending Vodafone paid even 5% in taxes and charity? Most of their wealth is from capital gain and dividend income which is tax free. Why should we listen to their lectures on taxation and also that of smart lawyers who have never argued a PIL?
  • What was the impact on FDI when Enron and Cogentrix left? So why use the discredited argument to scare people?
  • How many of the speakers on Mr Thapar’s show have been in conflict of interest on account of investment through Mauritius route or advising on it?

Do end justify means? The last one should be easy to answer: It all depends on whose ends.

(Arun Agrawal is the author of the book Reliance: The Real Natwar. The opinions expressed by the author and those providing comments are theirs alone, and do not reflect the opinions of Canary Trap or any employee thereof)

KGB activities in India, Pakistan and Afghanistan

“Information was to be conveyed to India and Iran to the effect that by building up its military potential Pakistan was in fact preparing for aggression not only against Afghanistan, but also against India and Iran.”

“India was to be told that Zia-ul Haq was giving Afghan refugees an anti-Indian outlook and using Afghan emissaries to conduct activities favorable to Pakistan in India. The plan also provided for intensified anti-Pakistan propaganda directed at India and other countries abroad, and the setting up of a Committee for the return to India of the Pakistan-occupied part of Kashmir.”

“Disinformation was to be conveyed to Gandhi on joint operations by the US, Pakistan and the People’s Republic of China to destabilize the situation in Jammu and Kashmir.”

The above details are a part of a wide-ranging operational plan code-named ‘TORKHAM’ conceived by a working group of erstwhile KGB in February 1981 in order to prevent the activities of the US, Pakistan, and China against USSR-occupied Democratic Republic of Afghanistan (it was renamed so in 1978).

This and more details about KGB’s activities in South and Southwest Asia in 1980-82 have been revealed by the Russian intelligence agency’s archivist Vasiliy Mitrokhin. The Cold War International History Project (CWIHP) of the US-based Woodrow Wilson International Center for Scholars have published a document which complies “active measures” of KGB in the region. The compilation is based on the notes Mitrokhin had smuggled-out.

“The intervention of Soviet forces in Afghanistan in December 1979 provoked sharp protests from the world community. The KGB took various measures, including some involving disinformation, to neutralize the negative response and distract attention from the activities of the USSR and its forces in Afghanistan,” the compilation states.

Mitrokhin reveals that Yuri Andropov, then Chairman of KGB, approved a plan of action in February 1980, which includes the following activities (reproduced verbatim):

  • Information is to be planted in the local press in Pakistan to the effect that the ruling regime is artificially whipping up the atmosphere relating to events in Afghanistan with the object of building up the Pakistani Army, further increasing its influence in the country, and maintaining the ban on the activities of political parties and organisation for an indefinite period.
  • In Bangkok, information is to be conveyed to the Pakistan Mission to the effect that within the Carter Administration there are doubts about the utility of further increases in military assistance to Pakistan, given the Zia-ul Haq regime’s unpopularity in the country. [US] Secretary of State [Cyrus] Vance and his assistants consider that, in order to avert another major failure of US foreign policy, it is imperative to seek to replace the dictatorship with another regime which would guarantee stability in Pakistan.
  • In India, information is to be conveyed to Prime Minister Gandhi to the effect that Pakistan is not satisfied with the insignificant scope of American military assistance and the condition imposed on it to abstain from exploding a nuclear device while the American assistance program is in force.
  • Through the UN leadership, information is to be conveyed to representatives of Iran to the effect that, in return for growing military assistance to Pakistan, the US is seeking to be granted military bases on Pakistani territory, including in Baluchistan, in close proximity to the Iranian frontier. The leaders of Pakistan are inclined to make concessions to the Americans on this issue.

The plan, approved by Andropov, was extended in September 1980 and a working group was setup. The group devised a “wide-ranging operational plan code-named ‘TORKHAM’. According to Mitrokhin, the plan was to be  was to be carried out in various countries, in accordance with individual plans which included elements like:

“Compromise the Zia-ul Haq regime; weaken the positions of the US and China in Pakistan; exacerbate relations with Iran; intensify and deepen disagreements between India and Pakistan on existing disputed issues; inspire new irritants in Indo-Pakistan relations; reinforce the antipathy and suspicion felt by Indira Gandhi and other Indian leaders towards Zia-ul Haq personally; compromise him in the eyes of the Muslims of India and other countries in the world; induce the Government of India to seek to secure the end of Pakistan’s support for the Afghan rebels; step up the activities of Pakistani émigrés and of the nationalist movement, particularly in Baluchistan; disrupt Afghan émigré organizations; intensify the local population’s hostility towards Afghan refugees.”

Mitrokhin revealed that as a part of the plan information “was to be conveyed to India and Iran to the effect that by building up its military potential Pakistan was in fact preparing for aggression not only against Afghanistan, but also against India and Iran.”

Other activities directed at India include (reproduced verbatim):

  • In Delhi, convey information to the effect that the US and NATO have plans to set up an anti-Indian alliance in South Asia in which Pakistan would plan a key role. Western countries are not only strengthening Pakistan’s military might but also encouraging its subversive activity against India and inciting it to inflame disputes between Hindus and Muslims, as well as the Sikh aspiration to set up an independent Khalsalistan.
  • In Dhaka, convey slanted information to Indian diplomats about the Pakistani leadership’s aggressive intentions against India, the junta’s strategic plans, aroused by the practical actions of the US and the People’s Republic of China which aim to weaken India’s positions in the subcontinent in every way and rapidly build up Pakistan’s military potential.
  • The Chukhrov Working Group also considered the question of creating a new irritant—the problem of setting up an Azad-Kashmir independent of Pakistan and India, and the notional formation of a Free Baluchistan government-in-exile in Afghanistan. But in view of the extreme complexity and uncertainty of many aspects of the situation, this question was postponed indefinitely.

Mitrokhin states that some of the KGB activities were aimed at impeding the improvement of Indo-Pak relations, which contributed “to the failure of the Pakistani leadership’s attempts to improve relations with India and to reduce tension on the borders with India.”

The KGB archivist further reveals that a document named ‘The Haig Memorandum’ was produced. Some of the elements of this document include (reproduced verbatim):

  • The US considers that Pakistan must be a bastion of the free world on the borders of Iran, the Democratic Republic of Afghanistan and the Indian Ocean, in order to block India’s ambitious claims to the leading role in the Indian Ocean.
  • The US is ready to help Pakistan to build its Navy (lending it 1 or 2 aircraft carriers), naval bases at Gwadar, and extend anchorages in Karachi harbor.
  • The Reagan administration welcomes Zia-ul Haq’s attempts to create the appearance of good will towards India, but there can be no illusion about the fact that while Indira Gandhi remains in power, Delhi is bound to follow the Soviet political line.
  • Consequently, there must be no let-up in joint efforts in the Washington-Peking-Islamabad triangle to destabilize the Indian government.
  • The US is prepared to consider Pakistan’s request for the supply of AWACS [Airborne Warning and Control System] aircraft for use along the border with India, subject to the subsequent equitable sharing of the data acquired between the US, China and Pakistan.

Mitrokhin also stated how a KGB Resident (Gennadiy Afanasyevich Vaumin) in Delhi proposed (in his telegram No 1669 of 5 May 1981) that in order to keep the Babrak Karmal regime in power in Afghanistan, a war between India and Pakistan would be advantageous for the Soviet Union, and they must be steered in that direction.

The KGB archivist has documented a host of other activities carried out by KGB in the region to protect its occupation of Afghanistan.

Click here to read the entire document: “KGB Active Measures in Southwest Asia in 1980-82”