Sweet Pill Seller Turned Arms Dealer May Now Spill The Beans

New Delhi: Amidst the massive dustup in Delhi over an armed dealer’s alleged links with the Gandhi family, Sanjay Bhandari – the man in the hot seat – is making a very, very silent move.

Reports shared by the BJP indicate Bhandari worked closely with Vadra, helping him in establishing his business in India, and abroad.

BTVI has learnt that Bhandari has sent feelers to NDA through his friends in Delhi that he could explain his point of view, and also name Congress politicians who routinely backed him because of his Vadra link. It is almost like turning an approver in a high-voltage case. It is not immediately known whether the NDA government has agreed to his proposal.

Sources in faraway London said Bhandari took the cue from another arms dealer Sudhir Choudhrie who played the peace pipe with the NDA government and recently visited the Indian Capital to attend the last rites of veteran Congress leader RK Dhawan. The special permission, BTVI has learnt, was granted only after Choudhrie agreed to explain in detail how such defence deals worked during the UPA regime and who were the top middlemen.

London-based Choudhrie and his son Bhanu were arrested in 2014 by the UK’s Serious Fraud Office (SFO). The SFO was investigating charges that British giant Rolls Royce paid several million dollars to shell companies affiliated to Choudhrie to cement the $2.1 billion deal for engines on the Hawk advanced trainer aircraft used by the Indian Air Force. Interestingly, both were released on bail when no critical evidence was found. In India, a probe by the Central Bureau of Investigation (CBI) also met a similar fate.

Choudhrie, now put on a list of “Undesirable People”, is barred from working in India. Choudhrie began experimenting with television imports from the UK to India in the 60s and eventually shifted to alleged illegal brokering of arms deals. He was helped by his uncle B K Kapoor, then Chairman of state-owned defence group Hindustan Aeronautics Limited (HAL).

But now, one of the biggest influencers of defence deals, is ready to spill some beans. And this is not good news for Bhandari.

In the Indian Capital, once home to Bhandari, many are – actually – wondering why Bhandari, shunned his family business of homeopathic medicines for a career in arms.

Bhandari is, arguably, the man in the hot seat. The ruling NDA-led Bharatiya Janata Party (BJP) has said he is a top arms agent who worked as a counsellor for Robert Vadra, the influential brother in law of Rahul Gandhi, president of the Congress party. Reports shared by the BJP indicate Bhandari worked closely with Vadra, helping him in establishing his business in India, and abroad.

As per Indian laws, there’s nothing wrong in the association. What is wrong is that Bhandari was among the contenders for the billion-dollar contract for jets to be procured by the Indian Air Force when the UPA government was in power. It is presumed by the BJP that his connection with the nation’s First Family – a tag enjoyed by the Gandhis for generations – gave him an advantage over the rest. The deal was eventually cancelled by the BJP government which eventually modified the contract to 36 jets from 100 plus planned by the UPA. 

And then, the BJP blamed Rahul Gandhi for targeting the ruling NDA because he was annoyed that his family friend – Bhandari in this case – lost out on the deal. BJP spokesperson, Dr Sambit Patra, said he had documentary evidence to prove a nexus between Vadra and Bhandari due to which the Rafale deal with French firm was cancelled in 2012. “Bhandari, who has close links with Vadra, formed a company named Offset India Solutions (OIS) in 2008 and he formed a joint venture with Rafaut as he tried to enter into an offset clause in the Rafale fighter jets deal through the back door,” Patra told reporters in Delhi.

Patra further alleged that the then Congress rejected Hindustan Aeronautics Limited (HAL)-developed Hindustan Turbo Trainer-40 and went for the Swiss aircraft Pilatus in 2012. “This deal was given to the Swiss company to bribe the Gandhi family and to pay commission on the deal to Gandhi family,” he added.

It is now clear that a few Congress politicians had mounted pressure on the French firm Dassault Aviation to give works to Bhandari’s company. It is not known who were those politicians who recommended Bhandari’s company, knowing very well the company lacked total infrastructure to execute a project of an international proportion. Expectedly, OIS was one of the bidders in the Rafael case. What is strange is that the French government received some strong recommendations from India to consider OIS’s bid in the Rafael deal. 

But it still did not work, ostensibly because in an international defence deal, the company had to invest 30 percent of the amount in India (risen to 50 percent under the Make In India scheme). Dassault found OIS had no infrastructure. The French company found Bhandari’s links with Vadra, eventually Dassault backed out and signed the deal with Mukesh Ambani’s RIL. But that did not work and Anil Ambani got into the defence business\. What is interesting is that HAL was in the picture then too, but no recommendations came for it. Worse, no representative of HAL went for a meeting with Dassault ever.

This is on paper, well documented in the files of the Defence Ministry and Bhandari, now holed up in London, is feeling the heat.

Bhandari, who 18 offices and residential apartments were raided in 2016, knows time is running out for him. Documents recovered from the search indicated emails exchanged between him and Vadra, and Vadra’s close associate Manoj Arora and Sumit Chadha, a relative of Bhandari. Chadha – documents show – paid Rs 19 crore for a flat in London for Vadra and also his air travel expenses.

Bhandari, who knows he has friends both in the Congress and the BJP, must count his marbles and settle his case. He had managed to remain under the radar for long till one innocuous Income Tax raid on hawala operators in Delhi led IT officials to his door. In question was a Rs 116 crore entry. Raids on his home showed Bhandari had access to classified documents from the defence ministry, properties in Dubai and London and owned a Panama-based company. 

More importantly, he knew Vadra, a very powerful handle to do business in India. He also knew veteran BJP leader Lal Krishna Advani and Siddharth Nath Singh, and former Delhi CM Shiela Dixit. All have denied knowing Bhandari as an arms dealer. Singh even said he thought Bhandari was in the hydrocarbon business. There were others too, among them one Appa Rao, the OSD to former civil aviation minister Ashok Gajapathi Raju. Bhandari – claims a report by the MHA – used a host of retired defence personnel.

And the connections helped Bhandari. A tech-savvy person, he even create a software to break the WhatsApp encryption code. He eventually got into the business of providing technology for doppler weather radars for civilian and military application. His company bagged a deal with Pilatus AG of Switzerland, which remitted Rs 33 crore in 2010 to this company. He was linked to negotiations to sell F-16 and F-18 fighter jets made by Boeing and General Dynamics respectively, a deal that eventually went to AgustaWestland.

But till date, Bhandari has not talked, routinely avoiding questions from the CBI, ED and Income Tax. What is further interesting is that Bhandari, in his statement to the IT department, said he was ownership of the properties. And he didn’t deny his friendship with Vadra. A senior officials of the Enforcement Directorate (ED) said flat in question in Bryanston Square was sold to Mayfair Investment FZE, an UAE company with a Sharjah address: Post Office Box No. 49304, Hamriyah Free Zone.

There were other properties Bhandari acquired in London, one at Bourdon Street, bought for Rs 10 crore in 2013, and a flat at the expensive Jumeirah zone in Dubai, bought in 2010-11 for Rs 5 crore. And each time he was questioned about the same, he feigned ignorance, saying he would need to consult his accountants to check about the properties. 

The Outlook newsmagazine said “Bhandari remained silent on transactions in his Standard Chartered bank, especially payments made in two tranches to this company in August and in October 2010, two years before the IAF bought 75 Pilatus basic trainer aircraft from the Swiss for Rs 4,000 crore.

The payments of 2,50,000 Swiss francs and 7,50,000 Swiss francs were made from the Zurich branch of UBS Bank to the OIS acc­ount number 52105058250. The remitter was Pilatus Flugzeugwerke AG. It was after this deal that Bhandari actually came into the limelight. Was the money meant for the offset business of Bhandari or was it kickbacks?”

This story by Shantanu Gura Ray was first reported here

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