The Bofors Scandal

There was more trouble for the prime minister. In March 1986, India signed an agreement with the Swedish arms manufacturer AB Bofors (once owned by Alfred Nobel) for the supply of four hundred 155mm Howitzer guns for the Indian Army. The deal included an option to license-produce 1000 more guns. The deal amounted to $285 million (about Rs 1500 crore) which was huge for the time.

Almost a year later, in April 1987, a Swedish radio report claimed that the Bofors deal involved payment of bribes to top Indian politicians and defence personnel as well as Swedish officials.

The Hindu correspondent in Geneva, Chitra Subramaniam, investigated the matter on behalf of her paper and collected several documents on the basis of which she revealed that over Rs 64 crore was indeed paid to some very powerful people. One name that appeared amidst it all was that of Ottavio Quattrocchi, an Italian businessman who represented the Italian petrochemicals firm Snamprogetti and was alleged to have become a powerful broker between the Indian government and international businesses, mainly because of his reported closeness to the Gandhi family. The Indian Express and The Statesman also carried long reports on what came to be known as the Bofors scandal.

In the meanwhile, V.P. Singh who had been shifted from

finance to defence also seems to have uncovered details of corruption in the Bofors deal. V.P Singh was finally left out of the cabinet. This seems to have increased the suspicion against the Rajiv Gandhi government, and even against the prime minister himself. There was scepticism about Rajiv Gandhi’s declaration in Parliament that no bribe was paid and no middleman was involved. Rajiv Gandhi who had been nicknamed ‘Mr Clean’ suffered an irreparable damage to his image.

In July 1988, Rajiv Gandhi introduced what has been

termed as one of the most draconian bills drafted by the Indian government. The bill was aimed at checking the freedom of the press: it provided that an editor or proprietor of a newspaper/ journal could be imprisoned for ‘criminal imputation’ and ‘scurrilous writings’, terms which would be defined by the State. Apparently, he was pushed into introducing the measure because of the investigative journalism into the Bofors scandal. The bill was in the end dropped, but further damage had been done to the image of the government.