The Polyester Prince (26 page)

Not too deep down, Rajiv was prone to panic. When his initiatives went awry, as they tended to do among the deeply cynical and entrenched vested interests of his complex country, he would sometimes overcorrect his well-meant impulses by shabby manoeuvres or hurtful shows of a petulant temper. Rajiv had expelled the more egregious members of his mother’s inner circle, but only to install his own favourites. Later known as the ‘coterie’ they formed a barrier between the prime minister and his party, between Rajiv and reality. In the flattery and sycophancy that had built up around the Nehru-Gandhi dynasty, there were few to play the role of the court fools who accompanied the Roman emperors at their triumphs and whispered in their cars: ‘Thou art mortal.’

Within a few months of his Bombay speech in December 1985 about the Congress powerbrokers and corrupting business links, Rajiv was starting to have second thoughts.

The speech had been mocked within the party as the thoughts of a greenhorn. The tax and foreign exchange raids launched by V P Singh from April 1985 had brought constant complaints from big business. Few had resulted in completed prosecutions, but the arrests, searches and seizures – all immediately publicised-were humiliating punishment in themselves for moneybags used to getting nosy officials called off with a quick call to New Delhi…

By April 1986, the press was reporting an imminent revolt by Indira Gandhi loyalists.

Pranab Mukherjee gave an interview defending his record, and was promptly expelled on 27 April. Around mid-year, Arun Nehru-Rajiv’s first cousin and internal security minister-who was also regarded as close to Dhirubhai, became estranged from the prime minister. He was dropped from his ministry in October. In June, the commentator M. V. Kamath was writing that Rajiv’s honeymoon was over, because of the Boinbay speech and raids on industrialists.2 The Times of India’s editor, Girilal jain, was quoted as saying that big businessmen could no longer meet the prime minister. On 6 August, Rajiv was bailed up about the raids at a meeting with the Calcutta Charnhers of Commerce, and admitted within hearing of journalists that they may have gone too far.

In late August or early September, Rajiv opted out of the meetings arranged with Gurumurthy In October he met Dhirubhai for their first direct and private meeting since becoming prime minister. But it is still not clear at what stage Rajiv might have begun to perceive Dhirubhai as an Ay. After A, the nascent revolt in the Congress Party had featured politicians identified with the Ambanis.

There remains a wonderful story, still widely told in Bombay and New Delhi, that in their first meeting Dhirubhai bluntly told Rajiv he was holding a huge amount of funds on behalf of Rajiv’s late mother and-wanted to know what to do with the money. This is almost certainly apocryphal, though it became part of India’s political folklore because it fitted with Dhirubhai’s reputation for both brazenness and keen judgement of character.

More likely, Dhirubhai used the meeting to outline his big plans for industrial expansion.

The rapprochement seems to have been assisted meanwhile by Dhirubbai’s implanting the perception that his enemies were traitors to Rajiv as well. In particular, Dhirubhai would have picked on the suspicion felt by V P Singh towards.Amitabh Bachchan, the megastar of the Bombay cinema who had been drafted into Rajiv’s winning Congress slate at the end of 1984. The Bachchan family had been close to the Nehrus back in their common home town of Allahabad, a modern-day administrative centre at the ancient pilgrimage site where the Yamuna River flows into the Ganges. Amitabh and Rajiv had grown up together. Elected from Mahabad, Bachchan was seen by Singh as a potential threat to his own power base in the surrounding state of Uttar Pradesh. In late 1986, Singh’s staff were said to be alleging privately, without ever producing the slightest evidence to support it, that Bachchan, and his business - man brother Ajitabh who had taken up residence in Switzerland, had huge wealth hidden in Swiss bank accounts.3 According to a later report, it had been through Amitabh Bachchan that the October 1986 meeting between Dhirubhai and Rajiv had been arranged.4

On 2 December 1986, during a debate in Parliament’s upper house, a minister disclosed that the Central Bureau of Investigation-which comes under the prime minister’s control, through a junior minister-had started an inquiry into whether Gurumurthy was being given unauthorised access to secret government papers. A leak from the Industry Ministry’s Directorate-General of Technical Development (
DGTD
), the apparent basis for Gurumurthy’s articles in August about the ‘smuggled’ Reliance plants, was indicated as the specific focus. The
DGTD
was encouraged to make a formal complaint, which it did on 11 December-adding, either bravely or for the record, that the ‘favours purported to have been shown to Messrs Reliance Industries Ltd by the officials of this office may also be investigated into’. On 21 December, the
CBI
raided Gurumurthy’s office in Madras and took away a number of documents.

The Enforcement Director Bhure Lai, who set off on his visit to the United States later in December, is understood to have suspected he was being shadowed from India by an agent of Reliance. Within days of Bhure Lal’s visit, a person who identified himself as an inquiry agent retained by Bhure Lal appeared in Bern, the Swiss capital, and began making inquiries about Ajitabh Bachchan. The Indian Embassy and possibly Bachchan himself became aware of this. The Embassy queried New Delhi and Bachchan may have contacted his brother.

Rajiv Gandhi was taking a New Year holiday with his family in the Andaman and Nicobar Islands, India’s south-eastern territory in the warm tropical waters at the northern entrance to the Malacca Strait. Amitabh Bachchan joined the Gandhis for part of the holiday, something that was publicised accidentally when the Indian airliner carrying Bachchan was diverted to the Burmese capital Rangoon because of technical problems.

The Gandhis returned to New Delhi in mid-January 1987. New Delhi was in one of its periodic military flaps about Pakistan. Earlier in the winter, India itself had conducted army manoeuvres on its western border, but these had now concluded. Yet Pakistan had just moved tank formations to forward areas. Rajiv called his cabinet together to assess the threat. On the evening of 23 January, he abruptly asked V P Singh to leave the finance portfolio and take charge of defence. Rajiv had been holding the portfolio himself, but the situation now required a senior cabinet minister overseeing defence full-time. Singh could hardly refuse, and the transfer was made and announced the next day.

Bhure Lal had reported on his American visit to his immediate superiors in the Finance Ministry, and was to file a written ‘Tour Report’ later in February which included the results of his follow-up correspondence with Du Pont and Chemtex. Soon after Singh was transferred, the prime minister’s office asked to see all the Enforcement Directorate’s records regarding the Fairfax inquiry, and Bhure Lal briefed the Cabinet Secretary, B. G. Deshmukh, about it on 28 January.

Around that time, his departmental head, the Finance Secretary S. Venkitaramanan, also pressed the Enforcement Director two or three times to reveal the subjects of his inquiries, explaining that if the ministry was going to be put in ‘hot water’ he should be forewarned. Bhure Lal demurred. The word was already out in the press that Bhure Lal had engaged an American private eye and that his targets included several big Indian companies and ‘a superstar politicians Later, rumours in New Delhi suggested a private eye had found evidence of Rs 6.5 billion in a Swiss bank account in the name of a company called Maeny Adol Brothers (perhaps a Lewis Carroll-Ue distortion of ‘Matinee Idol Brothers’), allegedly owned by the Bachchans and unnamed ‘Italians’ with Indian links. No evidence of any such company or bank deposit was ever produced, but combined with the appearance of the self-proclaimed investigator in Switzerland, the rumours added to the heat under the prime minister’s friends.

The government’s legal machinery was meanwhile working against Reliance on the customs and excise evasion questions. Dhirubhai was not yet out of the soup. But V P Singh was uneasy. On 9 March he asked for Bhure Lal’s file on Fairfax to be sent across to him at Defence in South Block, and annotated in a margin that he had approved the engagement of a foreign detective.

Around 10 or 11 March, copies of two sensational letters were shown to Rajiv, most likely through one of the senior bureaucrats in his office, Gopi Arora. The letters were to have dire consequences for Rajiv Gandhi. How they reached the prime minister’s office has never been revealed. Both were apparently written on the letterhead of the Fairfax Group. The first, dated 20 November 1986, said:

Dear Mr Gurumurthy,

Dr Harris apprised me of his useful meeting in New Delhi last week with Mr R. Goenka, Mr N. Wadia, Mr V Pande, Mr B. Lal and yourself. Now that the group has been retained to assist the Government of India we hope to expedite end result.

We received only US$300 000 arranged by Mr N. Wadia. As considerable efforts have already been made and expenditure incurred, it is advisable Mr Goenka arranges during his forthcoming visit to Geneva an additional US$200 000. We shall refund both amounts on receipt from the Government of India to E Briner, Attorney, 31, Cheminchapeau-Rogue, 1231, Conches, Geneva.

We shall apprise Mr Goenka in Geneva about the progress made on source of funds for purchase of Swiss properties of Mr Bachchan. We shall contact Mr Goenka at Casa Trola, CH-6922, Morcote (Ticini), during his visit.

Yours sincerely,
(sd) G. A. Mekay

The second letter carried no date:

Dear Mr Gurumurthy,

Please send me the following details to continue our investigations: (i) The details of rice exports by the Government of India to the Soviet Union; (ii) Documents relating to the non-resident status of Mr Ajitabh Bachchan from the records of the Reserve Bank of India.

When Mr Bhure Lal visits here next time, we “I make his stay pleasant.

Yours sincerely,
(sd) G. A. McKay

The treachery of V P Singh and other friends like Nusli Wadia seemed confirmed.

Financed by Wadia and his mother’s old foe Goenka, the conspiracy was aimed at striking down Rajiv through his old friend, Bachchan. The details seemed to corroborate the plot: the Swiss attorney Briner was an old friend of Goenka’s who had visited him in Bombay a year or so before. Casa Trola, the address where Goenka was to -be contacted, was meant to be that of Nusli Wadia’s retired father. (But the composer of the letter had got it wrong: the name.of the house, Casa Fiola, was actually mispelled, and it was not close to Geneva but on the Italian-Swiss border.)

A panic-seized Rajiv handed the letters to the Central Bureau of Investigation, who immediately assigned the case to the team already investigating the apparent leak of the Directorate-General of Technical Development report to Gurumurthy. According to the complaint filed by the
DGTD
, the relevant file on Reliance had indeed disappeared for two weeks in July 1986, reappearing on a certain desk on 25 July, and Gurumurthy had appeared to have drawn upon it for his August articles on the ‘smuggled’ plant.

But the CBI’s two investigating officers, Yashvant Malhotra and Radhakrishna Nair, were reluctant to prosecute under the Official Secrets Act, originally passed by the British in 1923 to protect the Raj against embarrassment by nationalists and only slightly modified in 1949. How could it be used against an Indian journalist who had exposed in a newspaper the activities of a commercial enterprise? It was hardly the kind of offence listed in the Act: ‘passing surreptitiously information or official code or pass-word or any sketch, plan, model, article, note or document which is likely to assist, directly or indirectly an enemy …’ If Gurumurthy was to be penalised for his methods, they argued, Reliance should also be investigated for the apparent offences he had revealed.

The ‘Fairfax letters’ seemed to give the CBI’s director, Mohan Katre, the national security grounds that were so far lacking for an Official Secrets Act prosecution. The bureau’s full resources were thrown into the job.

All files on the Reliance investigation were collected from the Enforcement Directorate.

At 10.30 pm on 11 March, Bhure Lal was called at his home: he was being transferred to run the Finance Ministry section handling currency and coinage, one of the ministry’s most routine tasks, and was to hand over charge of the directorate the following morning.

At the same time, the Enforcement Directorate itself was removed from the responsibility of the Revenue Secretary, Vinod Pande, and put under the Finance Ministry’s Department of Economic Affairs, which came directly under the Finance Secretary, S. Venkitaramanan.

On 12 March, arrest and search warrants were sent by air to Madras and Bombay. At 1.30 am that night, a
CBI
team arrived at Gurumurthy’s house, put him under arrest on charges of criminal conspiracy and breaches of the Official Secrets Act, and seized car-loads of documents. In Bombay the agency arrested the partner in Gurumurthy’s accountancy firm, A. N. Janakiraman.

Later on 13 March, the
CBI
turned up and ransacked the Indian Express guesthouse, where Goenka happened to be staying. Wadia and the controversial Hindu ‘god man’

Chandraswami (to be indicted ten years later on charges of swindling a businessman of an attempted bribe in 1986) were calling, separately, on Goenka. Both were allowed to leave after being searched. As the
CBI
detectives went through his papers, Goenka had a telephone call. It was Dhirubhai, offering to help out in any way he could. Goenka slammed down the receiver.

At this point, the letters and their existence were not public knowledge. The waters were muddied even further by the splash in the Indian Express on the morning of 13 March of a highly critical letter written to the prime minister by the President of India, Giani Zall Singh. The elderly Sikh president, who regarded himself as India’s senior statesman, had been trying to assert himself over the young Gandhi heir. Zail Singh had refused his assent to one government bill on postal services earlier in 1987; he accused Rajiv of not consulting him on the Punjab, where insurgency was getting worse. He now rebuked Rajiv for under – mining the President’s high office, and warned he would not just be a ‘spectator’ to this process. That the Express should get hold of his letter was not surprising: Gurumurthy had drafted it, and Goenka’s close adviser S. Mulgoakar had improved the English. In their search of the newspaper’s New Delhi guesthouse, the
CBI
found a copy of the draft, with the corrections.