NEW DELHI, 7 November 2005 — India’s Foreign Minister K. Natwar Singh’s continuance in office hung in the balance yesterday with the government apparently deciding to probe allegations he illegally benefited from Iraq’s oil-for-food program.
Though no official announcement was made till late last evening, knowledgeable sources averred that a decision had been taken in principle on the probe and an official announcement was expected today.
“Once a probe is announced Natwar Singh’s position will become tenuous and it will become difficult for him to continue as his ministry will be part of the exercise,” said a source in the ruling Congress Party.
To add to the beleaguered minister’s woes, Enforcement Directorate sleuths yesterday searched business and residential premises of Andaleeb Sehgal who, according to a UN report by former US Federal Reserve chief Paul Volcker, played a key role in the Iraqi deal.
Sehgal is a friend of Natwar Singh’s son Jagat.
“We did question him during the course of the searches (which began at 11 a.m. yesterday) but he stonewalled all our queries. He has agreed to depose again,” said an Enforcement Directorate official.
Sehgal had been ignoring summons for the past two days in spite of these having been served at his two residences and offices in New Delhi. Security agencies had Saturday issued a “look out circular” against him to ensure he did not slip out of India.
Officials, however, pointed out that with the change in India’s tax laws, Sehgal could not be charged but could, at best, be penalized for bringing into the country any money from the Iraqi deal.
Sehgal and his firm Hamdan Exports, the Volcker report said, paid $748,540 (30 million rupees) into a Jordanian bank as an “illegal surcharge” for Iraqi oil, with the money eventually reaching Iraqi dictator Saddam Hussein.
The Volcker report named Natwar Singh and the Congress as “non-contractual beneficiaries” of the oil-for-food program.
Natwar Singh once again met Prime Minister Dr. Manmohan Singh yesterday but this did nothing to clear the air over his future.
“We discussed the Volcker report and its unsubstantiated references. We also discussed pressing foreign policy matters,” Natwar Singh told reporters cryptically after the meeting but refused to take questions.
The meeting was part of continuing discussions for the third day between Dr. Manmohan Singh and Congress Party President Sonia Gandhi and senior ministers to contain the fallout of the Volcker report.
Congress Party sources said the decision to order a probe into the allegations contained in the Volcker report was taken after two senior ministers — both of them eminent lawyers — suggested that the document placed Natwar Singh on slippery ground.
Dr. Manmohan Singh had on Saturday asked Finance Minister P. Chidambaram and Minister of State for Science and Technology Kapil Sibal to examine the Volcker report.
Natwar Singh had on Saturday told NDTV he had the “complete support” of Dr. Manmohan Singh and Sonia Gandhi and would thus not step down.
The delay in announcing the probe, Congress Party sources said, was largely due to the net being cast wide for an individual of “impeccable credentials” to head it.
“This person has to be one whom no one can point a finger at or accuse of being sympathetic to the Congress,” a party source said.
The probe will examine four questions: 1. Did the Congress Party receive money? 2. Did any others receive money in the name of Natwar Singh or the Congress? 3. In what context do the Congress Party and Natwar Singh figure in the report? 4. Was any notice sent to the party and the minister?
The head of the probe panel will also be asked to meet Volcker and UN Secretary-General Kofi Annan to obtain more details about the episode, sources said. A visit to Iraq was also not ruled out.
The prime minister had on Friday asked India’s permanent representative to the UN Nirupam Sen to meet both Volcker and Annan.
The main opposition Bharatiya Janata Party (BJP), which has demanded Natwar Singh’s resignation, yesterday demanded a Central Bureau of Investigation (CBI) probe into the charges.
“The facts stated in the Volcker report constitute sufficient material to merit registration of a criminal case by CBI. Under the Foreign Contribution (Regulation) Act of 1976 no person can accept a foreign contribution or agree to acquire any currency from a foreign source on behalf of a political party,” BJP General Secretary Arun Jaitely told a press conference.
Natwar Singh has dismissed the Volcker report as “outrageous”.
“Why did Volcker name me and the Congress in the annexures, and not in the main report?” he asked during the NDTV interview. He said the annexures were the creation of the present Iraqi government that had no credibility.
Asked about the BJP’s demand for his resignation, he retorted: “The BJP is not going to decide who India’s foreign minister will be.”
