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Row on parallel Rafale talks rocks Parliament

NEW DELHI, Feb 8: A fresh political firestorm broke out on Friday over a report that the Prime Minister’s Office (PMO) had conducted parallel talks with the French government over the ?59,000-crore Rafale jet fighter deal and had prompted the Union ministry of defence (MOD) to protest that the PMO was undermining India’s negotiating position.

Both houses of Parliament were rocked by Opposition protests over the newspaper report, which defence minister Nirmala Sitharaman dismissed as “flogging a dead horse,” saying periodic inquiries by the PMO “cannot be construed as interference”.In a statement in the Lok Sabha, she said the opposition parties were playing into the hands of multinational companies and vested interests.

Members of the Congress, Trinamool Congress and the Telugu Desam Party (TDP) strode to the well of the house, chanting slogans and showing placards referring to the report. Opposition members shouted slogans demanding that Prime Minister Narendra Modi resign.

The report handed fresh ammunition to the Opposition to attack Modi’s National Democratic Alliance (NDA) government ahead of 2019 general elections.

The controversial defence deal, together with agrarian unrest, unemployment, and the alleged undermining of institutions such as the Central Bureau of Investigation and the Reserve Bank of India are at the heart of the Opposition campaign.

Congress president Rahul Gandhi reiterated his demand for a joint parliamentary committee (JPC) probe of the Rafale deal and used the report, published in The Hindu, to step up his attack on Modi.

“Now, we have been saying now for more than a year that the Prime Minister is directly involved in the Rafale scam. Now today, in The Hindu Newspaper, it is black and white — it is absolutely black and white that the Prime Minister himself was carrying out a parallel negotiation with the French,” Gandhi told reporters.

The newspaper report cited a November 24, 2015 defence ministry note to then defence minister Manohar Parrikar as saying that “we may advise the PMO that any officers who are not part of the Indian Negotiating Team (INT) may refrain from having parallel parlays (parleys) with the officers of French government.”

The note said that the details of the parallel negotiations conducted by the PMO had come to the defence ministry’s notice from an October 23, 2015 letter from General Stephen Reb, the head of the French negotiating team. “...In case the PMO is not confident about the outcome of negotiations being carried out by the MoD, a revised modality of negotiations led by PMO at appropriate level may be adopted in the case,” it added.

Sitharaman noted that the newspaper had published a file noting written by then defence secretary G Mohan Kumar that read: “It is desirable that such discussions be avoided by the PMO as it undermines our negotiating position seriously.”

She said that it showed only half the truth because a handwritten reply to the defence secretary’s note by then defence minister Manohar Parrikar was not reported.

“If a newspaper publishes a noting, then the ethics of journalism will demand that the newspaper publishes the then defence minister’s reply as well,” Sitharaman said.

“Then defence minister Manohar Parrikar ji replied to that MoD note saying ‘remain calm, nothing to worry, everything is going alright.’”

In his file noting, Parrikar wrote: “It appears that PMO and French president’s office are monitoring the progress of the issue which was an outcome of the summit meeting.” He wrote that the last paragraph, which suggested a “revised modality of negotiations to be led by PMO”, appeared to be an overreaction and suggested that the defence secretary resolve the issue on consultation with the private secretary to the PM.

Former defence secretary Mohan Kumar said the defence ministry note was “not about the pricing of the jets but about the sovereign guarantee.”

“Various points emerge during the process of negotiations. We had thought it was not necessary for another point of negotiations. The whole thing . The issue of a sovereign guarantee was sorted out to the satisfaction of both sides,” he said.

Initially, India had demanded a sovereign guarantee from France to back up the purchase of 36 fighters. Later, however, India agreed to accept a “Letter of Comfort” from Paris.

In December, the Supreme Court dismissed petitions seeking a court-monitored probe into the purchase of the Rafale fighter jets and said there was no reason to doubt the process. In an affidavit to the court, the government said negotiations with French officials was carried out by an Indian Negotiating Team as per the Defence Procurement Procedure-2013.

Gandhi repeated his accusation “chowkidar chor hai” (the watchman is the thief). “Now, I want to speak to the youngsters of this nation and I want to speak to every single member of the armed forces of this nation. This is about your future, you defend us, you protect us, you fight for us, you die for us and here it is absolutely clear that the Prime Minister has stolen ?30,000 crore of your money, bypassed the process and given it to his friend Mr Anil Ambani,” he alleged.

Sitharaman objected to Gandhi’s language. “It is very dangerous…Is he trying to provoke the defence forces?,” she asked.

Her colleague, minister of human resource development Prakash Javadekar, also rubbished Gandhi’s allegations. “The lie-manufacturing factory of Rahul Gandhi continues to operate and he has served us yet another lie,” he said.

“Rahul Gandhi and the Congress are working to get the Rafale deal scrapped. They are playing in the hands of foreign forces and companies with vested interest,” Javadekar alleged.

The NDA’S decision to enter a government-to-government deal with France to buy 36 Rafale warplanes made by Dassault Aviation was announced in April 2015, with an agreement signed a little over a year later. This replaced the previous United Progressive Alliance regime’s decision to buy 126 Rafale aircraft, 108 of which were to be made in India by state-owned Hindustan Aeronautics Ltd (HAL).

The deal has become controversial with the opposition, led by the Congress, claiming that the price at which India is buying Rafale aircraft now is ?1,670 crore for each, three times the ?526 crore, the initial bid by the company when the UPA was trying to buy the aircraft. It has also claimed the previous deal included a technology transfer agreement with HAL.

The NDA has not disclosed details of the price, but the UPA deal, struck in 2012, was not a viable one, former defence minister Parrikar has previously said, implying that it would have never been closed and that, therefore, any comparison is moot. Indeed, the UPA was not able to close the deal till 2014, largely over discussions related to pricing of items not included in the initial bid.

The NDA has said that the current deal also includes customized weaponry.

The deal has also become controversial on account of the fact that one of the offset deals signed by Dassault is with the Reliance Group of Anil Ambani. The Congress claims the earlier deal was scrapped and a new one signed just to provide Ambani this opportunity for an offset deal. Both the government and Reliance Group have repeatedly denied this.

Sniffing an electoral opportunity in the Rafale deal, the Congress has been relentlessly keeping up the heat. Gandhi has claimed that it is “the corruption of the century”.

In his reply to the debate on the Motion of Thanks to the President’s address in the Lok Sabha on Thursday, PM Narendra Modi said: “The Congress does not want our air force to be powerful. I am levelling a serious allegation. Who are they batting for?”

Former Lok Sabha secretary general and political analyst P Sridharan said, “The Supreme Court had said that there is no need for any enquiry into the Rafale deal. But now new facts are coming out. These facts are also very important. Political parties have the right to take their issues to the people and they must do so. But blocking Parliament proceedings would not serve any purpose.”

No tax on income up to Rs 5 lakh; no notional rent on 2nd home; farmers assured income in election budget

NEW DELHI, Feb 1: Finance Minister Piyush Goyal announced no tax on income up to Rs 5 lakh, a Rs 75,000 crore assured income scheme for small farmers and a mega pension scheme for workers in the unorganised sector in his proposed Budget 2019.

The initiatives are designed to woo the middle class, address farm distress and boost private investment in an effort to shore up the political base of ruling BJP-led national coalition that has been accused by the opposition of not delivering on its promises to the poor.

“India is solidly back on track and marching towards growth and prosperity,” Piyush Goyal said early in his budget speech, asserting that the government had succeeded in “we have broken the back of back-breaking inflation”.

He said the Narendra Modi government’s success in controlling inflation had put more money in the hands of people. “Inflation is a hidden and unfair tax, from 10.1 per cent during 2009-14,” he said.

Goyal announced exemption from tax on income of up to Rs 5 lakh per annum, which goes up to Rs 6.5 lakh if the individual tax payers invest Rs 1.5 lakh in provident fund and prescribed equities. He also proposed to increase the standard deduction from the existing Rs 40,000 to Rs 50,000. The proposal will benefit 3 crore middle class tax payers.

The TDS (tax deduction at source) threshold on interest from bank, post office deposits has been raised from Rs 10,000 to Rs 40,000. The finance minister further proposed to increase the TDS threshold on rental income from Rs 1.8 lakh to Rs 2.4 lakh.

The BJP-led ruling National Democratic Alliance (NDA) is facing discontent over depressed farm incomes and doubts over whether his policies are creating enough jobs. The interim budget allocates Rs 600 billion for a rural jobs programme and Rs 190 billion for building of roads in the rural areas.

Goyal said Rs 6,000 per year assured income support will be given to small and marginal farmers having less than two hectares of land. He announced a new fund, ‘Pradhan Mantri Kisan Samman Nidhi’ for disbursement of cash to “vulnerable farmers”.

Around 12 crore farmers will receive Rs 6,000 per annum under the PM Kisan scheme. The money will be transferred into bank accounts of farmers in three equal instalments. The finance minister said Rs 20,000 crore have been provided for current fiscal, 2018-19 under PM Kisaan scheme.

The government unveiled a mega pension scheme for the unorganised sector workers with an aim to benefit 10 crore people. Goyal said the beneficiaries will get assured monthly pension of Rs 3,000 after reaching the age of 60 years.

“We are launching Pradhan Mantri Shram Yogi Mandhan today. The scheme will provide assured monthly pension of Rs 3,000, with contribution of 100 rupees per month, for workers in unorganised sector after 60 years of age,” Goyal said.

The fiscal deficit would be 3.4 per cent of gross domestic product (GDP), slightly higher than the targeted 3.3 percent, said Goyal, who presented the budget as Union minister Arun Jaitley is undergoing medical treatment in the United States.

 

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