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NDA alleges graft in Scorpene deal

Pranab denied corruption in multibillion-dollar submarine deal and said he would make a statement in Parliament.
None | By Indo-Asian News Service, New Delhi
UPDATED ON MAR 21, 2006 01:30 AM IST

The Opposition on Monday alleged corruption in the multibillion-dollar Scorpene submarine deal.

At the same time, Defence Minister Pranab Mukherjee denied this and said he would make a comprehensive statement in both Houses of Parliament on Tuesday.

Maintaining they had "highly incriminating" evidence to support their charge, NDA leaders demanded that the $3.5 billion deal signed with two French firms be terminated and the entire episode probed.

The demand came at a press conference addressed by BJP leader LK Advani, flanked by NDA convener and former defence minister George Fernandes and Jaswant Singh, former external affairs minister.

But Mukherjee refuted the NDA's charge that the government had not responded to the opposition's claims about the involvement of middlemen -- which is barred by Indian laws - in the deal.

Speaking on the sidelines of a function organised by the Air Force Association, Mukherjee said he would make a statement on the matter in parliament on Tuesday.

Besides, he pointed out that the government had signed integrity pacts with the two French companies supplying technology for the six Scorpene submarines to be built in India.

These pacts prohibited the involvement of middlemen.

"If there is any deployment of middlemen, not only will the contract be cancelled but there will also be heavy penalties," he maintained.

Referring to reports that a leak of classified information from the navy's war room had benefited commercial firms involved in the deal, Mukherjee said the matter "had been referred to the CBI for investigation".

Mukherjee said the United Progressive Alliance government had re-negotiated the Scorpene deal and succeeded in reducing the prices that had been offered to the previous NDA government by the makers of the submarines.

"We managed to get the prices reduced by Rs 300 crores (Rs 3 billion)," he said.

Earlier, Advani drew on NDA's "own study and investigation" and said four per cent commission amounting to Rs 5-7 billion had been paid to middleman Abhishek Verma and his associates, making this "the biggest defence scandal so far, one that is far bigger than the Bofors scam".

He demanded the immediate arrest of Verma and his associates, and action against the foreigners involved in the leak of classified information from the navy's war room.

Advani pointed out that though the Outlook newsweekly that had reported on the alleged wrongdoing had named Verma as a middleman for Congress, there is neither any refutation from the party nor has it taken the magazine to courts".

He also sought the "institution of a credible commission of inquiry involving appropriate investigative agencies to pinpoint political responsibility and wrongdoing by others".

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