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Rafale deal: Modi govt waived anti-corruption clauses; and curious case of MoD financial advisor

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7 years ago

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Rafale deal: Modi govt waived anti-corruption clauses; and curious case of MoD financial advisor

[vc_row][vc_column][vc_column_text]The Rafale deal affair got muddier with reports raising further questions about Narendra Modi government’s actions.

A report by The Hindu said the Indian government made major and unprecedented concessions, waiving critical provisions for anti-corruption penalties and making payments through an escrow account dropped days before the signing of the inter-governmental agreement (IGA).

Modi has been claiming to be waging a relentless war against corruption and justifying cases against political rivals on this basis.

Also significant is the fact that this and other important information on the “parallel negotiations” conducted by the Prime Minister’s Office and the National Security Adviser seems to have found been withheld from the material submitted by the government to the Supreme Court of India, The Hindu reported.

Another report in India Legal mentioned the curious case of Modi government appointing an officer from the Indian Audit and Account Services (IA&AS) as financial advisor to the Ministry of Defence (MoD). The post is traditionally reserved for Indian Defence Accounts Service (IDAS) cadres.

The IA&AS officer in question, 1984 batch’s Gargi Kaul, is sister-in-law of Supreme Court judge, Justice Sanjay Kishan Kaul who was part of the three judge bench of the apex court, also comprising Chief Justice Ranjan Gogoi and Justice KM Joseph, which had, on December 14, dismissed a bunch of petitions demanding a court-monitored investigation into alleged irregularities committed by Prime Minister Narendra Modi’s government in finalising the Rafale deal.

A day after the Supreme Court verdict, on December 15, Gargi Kaul was empanelled by the Centre at the rank of Secretary, Government of India. Ten days later, on December 24, she was transferred to MoD. Prior to her transfer, Kaul was serving as Additional Secretary and Financial Advisor to the Ministry of Civil Aviation.

While this report has not yet drawn much attention or ruffled any feathers outside IDAS, The Hindu’s report had the Congress launch a fresh attack on Modi government.

Congress chief Rahul Gandhi Monday launched a fresh salvo at Prime Minister Narendra Modi. Quoting The Hindu report, the Congress chief said, “Every defence deal has an anti-corruption clause. Reports suggest that the PM removed the anti-corruption clause. It is clear that the PM facilitated loot.” Taking to Twitter, he wrote, “NoMo anti-corruption clause. The Chowkidar himself opened the door to allow Anil Ambani to steal 30,000 Cr. from the IAF.”

The Congress said the Rafale deal is “unravelling” faster than the government thought, with issues such as “parallel negotiations” by the PMO and changes in the standard defence procurement procedure coming to the fore.

Senior Congress leader and former finance minister P Chidambaram said in a series of tweets, “First, it was the loading of the India Specific Enhancement costs on 36 aircraft instead of 126 aircraft giving a bonanza to Dassault. Then it was the revelation that ‘parallel negotiations’ were being carried on by PMO undermining the efforts of the Indian Negotiating Team.”

Now it is revealed that crucial changes were made to the clauses in the standard Defence Procurement Procedure, he said. “No sovereign guarantee, no bank guarantee, no escrow account, yet a huge amount was paid as advance,” Chidambaram alleged.

Lashing out at the Modi government, he said, “No penalty clause for undue influence, no clause against agency commission, no clause for access to suppliers’ accounts, and Dassault goes laughing all the way to the bank.”

Citing the media report, Congress’ chief spokesperson Randeep Surjewala said, “Modiji, after waiving off sovereign guarantee in Rafale deal, you also waived off the ‘anti-corruption measure’ of a ‘safeguard Escrow A/c’! What is the corruption you wanted to hide?”

The whole country is abuzz that “chowkidar chor hai”, he said.

The Congress on its official Twitter handle, asked: “Throwing all good sense to the wind, the PMO also discarded the advice to create an escrow account under the control of the French Govt to release payments from India. Instead it chose to pay Dassault upfront in advance. Who was the PMO trying to benefit?”

“After the PMO forced the waiver of a sovereign guarantee, it now turns out the PMO asked for the WAIVER of standard ANTI-CORRUPTION clauses. Who was the PMO trying to shield? There is no doubt that #ChowkidarChorHai”

The Hindu report states that the government gave “major and unprecedented concessions” to the French side when the Rafale deal was signed between the two countries. This included dropping of “critical provisions for anti-corruption penalties and making payments through an escrow account”.

According to the media report, the high-level political intervention meant that standard Defence Procurement Procedure (DPP) clauses on “Penalty for use of Undue Influence, Agents/Agency Commission, and Access to Company accounts” of Dassault Aviation and MBDA France were dropped by the Modi government.

The newspaper further cites official documents that reveal that the Defence Acquisition Council (DAC) chaired by the then Defence Minister, Manohar Parrikar, met in September 2016, and “ratified and approved” eight changes in the IGA, supply protocols, offset contracts and offset schedules. The agreement and the documents had been approved by the Cabinet Committee on Security chaired by Prime Minister Narendra Modi before that on August 24, the report adds.

The most significant among these eight changes, recorded in a note signed by Vice Admiral Ajit Kumar, DCIDS (PP&FD) who was the member-secretary of the DAC, is at sub-para (c). This states: “Non-inclusion of the Standard DPP Clauses related to ‘Penalty for Undue Influence,’ ‘Agents/Agency Commission’ and ‘Access to Company Accounts’ in the Supply Protocols.”

The Hindu further quotes a dissent note by signed by three members of the Indian Negotiating Team that said: “…it is not advisable to sacrifice the basic requirement of financial prudence.”

The Rafale deal was signed between India and France under the terms of DPP-2013. Despite the procedure stating explicitly that the Standard Contract Document “would be the guideline for all acquisitions”, the Indian government chose to remove these clauses from the supply protocols with the two private defence suppliers, the report says.

The Hindu in its report says this was significant because the government also chose to do away with a sovereign or bank guarantee from France and settled for a letter of comfort, which is not legally binding, from the French Prime Minister.

After the introduction of a letter of comfort, another proposal that was turned down was one proposed by former defence bureaucrat Sudhanshu Mohanty

This came on the back of another turned-down proposal to have an escrow account operated by the French government. The Indian government would then release money to the account and France would make further payments to the firm as per terms agreed to by both governments as per the IGA.

“This would make French Govt. morally and materially responsible for the procurement so proposed,” Mohanty is quoted as saying in a separate note reported by The Hindu.

The newspaper had earlier reported on the defence ministry’s reservations to “parallel negotiations” conducted by the PMO in the deal.

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Case registered against Mamata Banerjee over controversial 2025 religion remark

A formal police case has been registered against Trinamool Congress supremo Mamata Banerjee in Siliguri, West Bengal. The complaint alleges that her 2025 “Ganda Dharm” remark targeted Hinduism and hurt the religious sentiments of the community.

Published

4 hours ago

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May 27, 2026

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Mamata Banerjee

A formal police complaint has been lodged against Trinamool Congress (TMC) chief Mamata Banerjee in West Bengal’s Siliguri. The legal action stems from an alleged derogatory remark regarding Hinduism made during an Eid congregation in Kolkata in 2025.

The case was registered following a complaint filed by a local lawyer, Rinki Chatterjee, who alleged that the former Chief Minister’s comments deeply hurt the religious sentiments of Hindus globally.

Legal charges and complaint details

The police have invoked multiple sections under the Bharatiya Nyaya Sanhita (BNS) against Banerjee, including Section 351(1) for criminal intimidation, Section 352 for intentional insult with intent to provoke breach of peace, and Section 353 for promoting feelings of enmity, hatred, or ill will between different communities.

According to the complaint, the controversy traces back to an Eid event organized on Kolkata’s iconic Red Road in 2025. While delivering a speech targeting the Bharatiya Janata Party (BJP), Banerjee purportedly referred to the version of Hinduism championed by the political rival as “Ganda Dharm” (filthy religion).

Chatterjee stated in her complaint that labeling Sanatan Dharma in such a manner at a religious gathering was “absolutely unacceptable”. The complainant also pointed to other instances where senior TMC leaders allegedly targeted Hinduism, adding that Banerjee made indirect threats to the Hindu community during the 2026 West Bengal Assembly election campaign to influence voters through intimidation.

Political responses to the FIR

The reported statements had previously drawn sharp criticism from the state BJP leadership last year, including strong objections from current Chief Minister Suvendu Adhikari. However, this FIR represents the first formal legal action taken regarding the speech.

When approached for a response, Atri Sharma, a lawyer and general secretary of the TMC’s Darjeeling unit, declined to comment officially as a party spokesperson. However, he noted that many within the party internal circles found the remarks inappropriate at the time they were spoken. Sharma acknowledged that holding a high public office required restraint and affirmed that every individual holds the moral right to pursue legal remedies.

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Congress Dismisses Karnataka Leadership Transition Rumors After Six-Hour Delhi Meet

The Congress party has rejected ongoing rumors regarding a leadership change or a rotating Chief Minister formula in Karnataka, stating that a recent six-hour meeting in Delhi focused strictly on the upcoming Rajya Sabha and MLC elections.

Published

19 hours ago

on

May 26, 2026

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The Congress party has strongly downplayed the intense political buzz surrounding a potential leadership transition or a change in the Chief Minister’s post in Karnataka. Following a marathon six-hour meeting with the state’s top leadership in New Delhi, the party explicitly rejected the ongoing speculation, labeling it as having “no reality.”

A brief statement issued to the media after the high-level meeting advised against spreading rumors, clarifying that the discussions were entirely centered on upcoming electoral strategies rather than structural changes within the state government. The party stated that the deliberations solely revolved around the state’s three vacant Rajya Sabha seats and the upcoming Member of Legislative Council (MLC) elections.

Rajya Sabha and MLC Polls Take Center Stage

The high-stakes meeting was attended by Congress President Mallikarjun Kharge, senior leader Rahul Gandhi, and party General Secretary KC Venugopal, alongside Karnataka Chief Minister Siddaramaiah and Deputy Chief Minister DK Shivakumar.

Briefing the media post-meeting, KC Venugopal stated that conversations were strictly confined to the Rajya Sabha and MLC elections, emphasizing that there is no truth to any other political speculation. Chief Minister Siddaramaiah also confirmed that the agenda of a potential cabinet expansion or a leadership shift did not come up during the six-hour-long discussion.

Background of the Power Struggle

The question of leadership in Karnataka has remained a recurring theme for over a year. Supporters of Deputy Chief Minister DK Shivakumar have consistently maintained that the central leadership promised a rotating Chief Ministership arrangement when the government was formed after the 2023 assembly elections.

Speculation had intensified recently as the ruling government faced local anti-incumbency pressures alongside renewed political activity from the opposition bench. Some internal reports had even indicated a push from within certain sections of the high command, including Priyanka Gandhi Vadra, for a leadership revamp.

Balancing Caste Equations and Party Structure

The central leadership has navigated the situation cautiously to maintain political stability. Chief Minister Siddaramaiah, 80, commands a powerful “Ahinda” support base—a coalition comprising minority communities, backward classes, and Dalits. This social alliance was crucial in helping the party navigate the traditional Vokkaliga and Lingayat caste dynamics during the 2023 elections.

Although the rotation issue had previously gained significant momentum when the government completed two years in office, the party high command had chosen to maintain the status quo to avoid any adverse electoral impact in neighboring assembly elections, such as in Tamil Nadu. With those elections concluded, supporters of the 64-year-old Deputy Chief Minister had expressed optimism for a transition. Shivakumar currently holds the dual responsibility of being the Deputy Chief Minister as well as the state Congress chief, signaling his critical organizational value to the party. However, for the time being, the party high command has firmly signaled that the current leadership structure will remain unchanged.

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Congress high command steps in to resolve Karnataka leadership impasse with crucial Delhi meeting

The Congress leadership, including Mallikarjun Kharge and Rahul Gandhi, is holding a vital meeting in Delhi with Karnataka Chief Minister Siddaramaiah to find a definitive solution to the state’s prolonged leadership impasse.

Published

1 day ago

on

May 26, 2026

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The top leadership of the Congress party is scheduled to hold a high-level meeting at its headquarters in the national capital today morning to address the long-standing leadership dispute in Karnataka. Senior leaders, including party president Mallikarjun Kharge and MP Rahul Gandhi, will lead the discussions aimed at resolving the continuous friction between Chief Minister Siddaramaiah and Deputy Chief Minister DK Shivakumar.

The ongoing power struggle over the state’s top position has persisted since the party’s electoral victory in 2023. For the current session, only Chief Minister Siddaramaiah has been called to join the discussions in Delhi. When questioned about the agenda by reporters, the Chief Minister stated that he was unaware of the specific subjects to be discussed, noting that political speculation is inevitable.

Background of the internal division

The internal friction intensified significantly in November 2025 when the state government completed its two-and-a-half-year mark in office. Supporters of the Deputy Chief Minister pointed to a purported unacknowledged internal arrangement suggesting a rotational chief ministership split equally across the five-year term. Despite multiple prior interventions by central party leadership to manage the internal friction, a permanent resolution has remained elusive.

While Deputy Chief Minister DK Shivakumar has not been invited to this morning’s initial session, indications suggest that separate individual discussions and a potential joint meeting involving both leaders are planned as part of the broader resolution process. Observers note that several state ministers and legislators have also traveled to the national capital as the party leadership aims to settle the administrative roadmap and finalise leadership plans before the next assembly elections.

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