Indira Gandhi

  Lacking intellectual ability and competitive capacity, Sanjay had to rely on assistance and protection in order to rise to prominence. The stages of responsibility usually involved in preparing for national leadership were substituted in his case by an encapsulated ‘progress’, bringing him, despite his doubtful reputation in business, to the fore in 1975 as the country’s youth leader and in May 1980, as architect of the Congress-I victory in elections to nine State Legislative Assemblies. Both claims were exaggerated. Each national political party has its own active and committed youth organization. Sanjay’s standing was confined to his mother’s party and not altogether acceptable within it. And it is likely that, by the time of the assembly elections, ‘the new emerging forces, an alliance of lumpen youth and amoral contact men who had transformed themselves into businessmen and industrialists’1 were attracted by a spoils system at its most inviting and opted for the party already in power at the centre. Mrs Gandhi could not have been unaware that there were promising young people in her party to choose from, some of them in politics since their student days, if leadership from among the young was to be commended. If she preferred to ignore the material available to her, it can only have been because she had set her heart on bequeathing power to her son. She treated the national controversy surrounding Sanjay’s business dealings and his role in politics as quite simply a lie, the invention of her enemies.

  Obviously this was a complex and in part a highly strung relationship—strained by unusual tensions, stretched by unusual elations—as any relationship must be where power is a palace preserve and the clandestine becomes a significant cog in the power machine. Sanjay shared access to vital information and intelligence. The Delhi administration, including the police, took its orders from him during the Emergency, and important Emergency officials were rehabilitated by him in Delhi and some state governments after the 1980 election victory. These included two key appointments, the lieutenant-governor and the police commissioner of Delhi, which made it easier to ensure the speedy and arbitrary dismissal of the capital’s two representative bodies, the Delhi Metropolitan Council and the New Delhi Municipal Corporation, while the daily crime bulletin issued by the police was altered to withhold complete information from the press and the public.

  Sanjay’s conduct during the Emergency had contributed to his mother’s defeat in 1977, yet he was more directly responsible for her triumphant return three years later, and Mrs Gandhi believed she owed her political resurrection at least in part to Sanjay’s advice and management. Much of her private torment and anxiety must have centred on the undisciplined young man, dangerously addicted to the shortcut, who had to be shielded from the public consequences of his actions. Inevitably, there were clashes of will and temperament. In a natural enough reaction to a strong-willed mother, both Mrs Gandhi’s sons resisted domination by her, though neither broke away from the parental roof, even after marriage, to set up a home and life of his own. In Sanjay’s case the paraphernalia and panoply of power were clearly a necessary accompaniment and background for the work he needed done with the help of official channels. Guilt feelings are part of parenthood, and it is possible that Mrs Gandhi laboured under some degree of guilt towards the problem marriage that her sons felt had treated their father unfairly.

  Indians understand the flesh and blood bond and are indulgent towards its frailties. A son as successor need not have presented a problem. It was Sanjay’s techniques that roused hostility, above all the ruthlessness visited on helpless people who had no redress against the prime minister’s son when he violated agreements, particularly during the Emergency when civil rights and habeas corpus were suspended. Fantasy ruled the day when Sanjay’s past was submerged and he was hailed as heir apparent, as the symbol of youth power, enterprise and adventure, and even as the leader of a cultural revolution. The virtues attributed to him at a condolence meeting after his death, comparing him with Jesus Christ, the Buddha and Karl Marx, testified that a myth was in the making. Judge D.C. Aggarwal had contributed to it when, on March 17, 1980, he had ‘discharged’ Sanjay Gandhi and an associate in the ‘polymix case’, where they had been accused of pressuring the New Delhi Municipal Corporation into buying a preparation marketed by Sanjay’s company, Maruti Technical Services. The case was one among many civil and criminal cases involving Mrs Gandhi, Sanjay Gandhi and those associated with them, dismissed by judges after Mrs Gandhi’s return. The judgement stated: ‘a dynamic manufacturer like Mr. Gandhi … can hardly be regarded as actuated by any dishonest intention to make illegitimate gain by dint of his political influence over the officers of the corporation.’ The facts, as revealed by the commission of inquiry appointed on May 30, 1977 under the chairmanship of Justice A.C. Gupta of the Supreme Court to examine the affairs of Sanjay Gandhi’s three concerns—Maruti Ltd, Maruti Heavy Vehicles (Pvt.) Ltd and Maruti Technical Services (Pvt.) Ltd—are different.

  By early 1975, Maruti, the car project for the manufacture of which a letter of intent had been issued to Sanjay in 1970, had not yet produced a car, except for a few prototypes, and it never did. Yet two private companies set up by him had drawn substantial funds from the main public limited company, Maruti Ltd. The Emergency, declared on June 26, 1975, ended all debate on Maruti affairs, enabling Sanjay to step into the national limelight as the coming leader. Witnesses questioned by the Shah Commission revealed it was Sanjay who had ordered the cutting off of electrical connections to newspapers on the night of June 25th, so that many could not appear the next morning, and that he had also suggested the locking up of high courts. The chief minister of West Bengal, Siddharth Shankar Ray, who was in Delhi to help Mrs Gandhi prepare a draft proclaiming the Emergency, opposed these measures and remembers that Sanjay met him ‘in a highly excited and infuriated state of mind and told him quite rudely and offensively that he did not know how to rule the country’.2 Mr Ray also states that the draft he prepared was not used.

  The Gupta Commission examined 712 affidavits and about 2000 files of the Union and state governments, statutory bodies and other institutions. It held 111 public sittings between December 16, 1977 and February 16, 1979 and examined 268 witnesses. Justice Gupta submitted his report to the government on May 31, 1979. Yet the government’s prevarication and indecisions, and finally its fall, held up its release to the press until September. In Chapter X of a precise and heavily documented report, Justice Gupta sums up his conclusions:

  The affairs of the Maruti concerns … appear to have brought about a decline in the integrity of public life and sullied the purity of administration. Legal and other requirements were brushed aside, and accepted norms of behaviour were forgotten on many occasions when the interest of a Maruti company was involved. This was due to, as witness after witness repeated, an atmosphere of fear then prevailing… . And the fear was real. Threat of detention under the Maintenance of Internal Security Act or a CBI inquiry or other forms of harassment made it hazardous for the officers to insist on the rules or the dealers and depositors to insist on their rights. Persons in public life were in danger of having their political careers ruined. That it was not an idle threat is proved by instances of persons in whose case the threat was carried out… . From the interest taken in Maruti’s progress by men from the Prime Minister’s Secretariat and the way even matters connected with the country’s defence were subordinated to the interest of Maruti Ltd., and the prevailing sense of fear that prompted implicit obedience, one is left in no doubt as to the origin of the power that made such a state of affairs possible. Shri Sanjay Gandhi exercised only a derivative power, its source was the authority of the Prime Minister.

  A number of irregularities in the working of the Maruti companies have been noticed in the foregoing pages. The minutes books do not appear to have been kept in the prescribed manner, at least two resolutions stated to have been passed by the Board of Directors of Maruti Ltd. have not been recorded. Evidence has been adduced showing that shares of Maruti Ltd. were allotted to persons who knew no
thing about the transactions, also that in February 1977 large sums of money were paid out to fictitious persons as refunds of their dealership reservation money or deposits made by them along with their alleged applications for Maruti shares. All these indicate the presence of unaccounted money. It has not been possible for the commission to examine all the vouchers, books of original entries and other records and documents. What is revealed in such examination as the commission has been able to do suggests that if a joint or co-ordinated examination of the records of the Maruti companies is done by the Departments of Revenue & Company Affairs, and their books of account are audited by a special team, many more irregularities are likely to come to light.3

  The Gupta Commission’s report is the source from which the brief and incomplete account below is taken.

  The Government of India had been considering the manufacture of a small, low-cost car since 1959 but had taken no decision about whether it should be produced in the public or private sector, whether a new unit should be set up or existing units expanded, when Sanjay Gandhi applied for an industrial licence to produce a small car on December 11, 1968. After high school in India, he had joined Rolls Royce Motors in England as a special student apprentice, from August 1964 to July 1967. A letter from the assistant secretary, Rolls Royce Motors, to the commission explains that, following the ‘normal practice for student apprentices’, Sanjay ‘attended the local Technical College on a day-release basis (one day each week) throughout the three years he was with the company’ and ‘received an ordinary National Certificate in Mechanical Engineering’ on passing an examination in June 1967. This was a ‘relatively minor qualification and two years further study would have been necessary for him to obtain a significant academic qualification, which would have been a Higher National Certificate’.

  Four months before Sanjay applied for a licence, Fakhruddin Ali Ahmed, then minister for industrial development and company affairs and later elevated to the presidency, forwarded a project report for Maruti to the Planning Commission and the Directorate General (of ) Technical Development (DGTD), bodies that do not normally look at project reports until an application for an industrial licence has been made. The Planning Commission does not in any case analyse reports from prospective licensees. On January 4, 1969 Sanjay, in a discussion with the Secretary of the ministry of industrial development and company affairs, and some DGTD officials, suggested he be given a letter of intent before his prototype car was ready, but was told that DGTD officials would have to study the prototype first.

  The Maruti prototype was ready in October 1969, and the DGTD suggested improvements, modifications and a detailed survey by Sanjay of the availability and prices of the ancillaries and parts he proposed to use. At this time the possibility of a new car unit in the public sector was still being considered by the cabinet. On August 7, 1970, Mrs Gandhi presided over a cabinet meeting that decided to permit the manufacture of a car in the private sector ‘based on completely indigenous sources’, as the minister for industrial development and internal trade clarified in both Houses of Parliament on August 10. The word ‘indigenous’ was defined at various times by different ministers, in answer to questions in Parliament, to mean machinery, components and materials produced in India. This was a basic requirement in terms of India’s industrial policy, which included the need to conserve foreign exchange.

  On September 23, 1970, the Hindustan Times reported:

  Prime Minister Indira Gandhi today commended the enterprising spirit of her son, Mr. Sanjay Gandhi, in putting forward a proposal for a small car, completely Indian. Mrs. Gandhi said she could not say whether a licence would be granted to him. She had been asking all young men to be enterprising even before her son had taken to designing a car. Her son was a delicate young man and with whatever money and energy he had, he modeled a car, not a posh one, but fairly comfortable and suitable to Indian conditions. It would suit the middle class, she added.

  A week later, on September 30, a letter of intent was issued to Sanjay for the manufacture of an annual capacity of 50,000 cars at Faridabad in Haryana. It is interesting to note that the capacity achieved by established car production units during 1970–71 was 46,000, and this remained the highest figure for the next several years. The letter of intent, valid for six months, was subject to four conditions:

  1) No foreign collaboration

  2) No import of capital goods

  3) No import of components/raw materials

  4) Before the letter of intent is converted into a licence, prototype(s) will be developed and tested, and approved for roadworthiness by an authority appointed for the purpose by the government.

  In October 1970, Sanjay asked for a relaxation of the condition relating to the import of raw materials. This was granted, provided raw materials normally available in the country happened to be in short supply. His letter of intent was also extended, at his request, to eighteen months (it was further extended up to December 31, 1973 and then until June 30, 1974), and he was permitted to set up his factory at Gurgaon in Haryana, (instead of Faridabad) where Chief Minister Bansi Lal had offered him facilities and his choice of land on easy purchase terms. The area chosen by Sanjay had been designated part of the rural belt by state planners. It was converted into an industrial zone to permit the construction of Sanjay’s factory, and later portions of it were leased out by Sanjay, against regulations, for other purposes. Of the 291 acres selected, 157 belonged to the defence ministry, which controlled a 900-metre safety belt around an ammunition depot near an airfield. This consideration was ignored, as were the heavy losses incurred by citizens who had invested in plots in the rural belt and by villages in the area whose claims were summarily disposed of. Referring to this in the Lok Sabha on December 22, 1972, S.N. Mishra, an Opposition MP, said:

  The Chief Minister of Haryana has left nothing undone to place the Prime Minister in a situation of blackmail. He has robbed the peasants… . He has violated the defence rules which prohibit the setting up of such factories or any construction within a particular distance… . He has tried to equate public interest with private interest and also tried to say to the world that industrial estate means personal estate.

  The Maruti prototype arrived for testing at the Vehicles Research and Development Establishment (VRDE) in Ahmednagar on February 10, 1974, after Sanjay failed to get the trials shifted to Delhi, under an observer chosen by the ministry of industrial development. The correspondence between VRDE and Maruti Ltd and the representations Maruti Ltd made to the ministry of heavy industry reveal the company’s persistent efforts to try to change the condition in the letter of intent requiring the prototype’s testing for roadworthiness. Inspection on February 11 revealed that the car had a German engine. W.H.F. Muller, a German consultant employed by Maruti Technical Services in July 1972, had brought it into the country as part of his personal baggage:

  I had two such (NSU) engines with me in West Germany. I had purchased them long back in the sixties… . Shri Sanjay Gandhi wanted me to go to West Germany and bring the two engines… . (He) assured me that he would make arrangements for their easy passage into this country… . I arrived at New Delhi on 30th September 1973… . Shri Sanjay Gandhi advised me to get them cleared myself… . I had not obtained licence to import them in view of Sanjay’s assurance to get these things cleared without any difficulty… .4

  Asked for detailed information about the prototype, Maruti Ltd wrote to VRDE, listing several components as ‘presumed to be imported’ but ‘original supplier not available’. Some parts were admitted as imported, with the rider that these would be replaced by indigenous components.

  The VRDE catalogued a list of defects during the first test. The reliability test failed altogether when the car had a major breakdown of the steering rod and fell into a ditch. On July 3, 1974, S.M. Ghosh, Joint Secretary in the ministry of heavy industry, sent Sanjay a copy of the VRDE director’s letter to the ministry on the subject of the Maruti prototype’s faults. Ghosh’s
own covering letter read:

  I shall be very grateful if you would kindly arrange to send the Chief Designer along with a team of engineers both on the manufacturing and on the design sides to Ahmednagar immediately in order that they can properly investigate into the defect and put the car back on the road after necessary rectification. I shall be grateful if you would advise me that the Chief Designer and a team of engineers have, in fact, left for Ahmednagar to remove the defects. I shall also be grateful if I could be kept apprised of the progress made in putting the car back on the road for resuming the tests.

  These repeated expressions of gratitude where none were necessary, indicate an official nervousness, not surprising when any normal procedural delay in processing Maruti had met with a telephone call from Professor P.N. Dhar in the prime minister’s secretariat, wanting to know the reason for delay, and R.K. Dhawan also of the prime minister’s secretariat, delivering the sharp reprimand that he would ‘report to the highest’. Cabinet ministers* were acquiescing in the cover-up of Maruti, and Mrs Gandhi was closely monitoring all developments concerning it. The record later showed that she went through parliamentary questions on Maruti, and ministers’ replies had to be cleared with her. In late 1975 or early 1976, she removed, under cover of the Emergency, all notes on Maruti from files in the prime minister’s secretariat.

  On July 4, 1974 S.M. Ghosh, ignoring VRDE’s reservations, recommended that Sanjay Gandhi’s letter of intent be converted into an industrial licence. The Maruti prototype had not met the standards of the tests made thus far, and testing was not yet complete. Mr Ghosh noted on the file that Maruti manufacturers had confirmed that all major components and assemblies were of indigenous design. The licence was issued on July 25, 1974, before the requirements of the letter of intent had been fulfilled or, as far as the record shows, even accurately examined. It is established, however, that it was issued in disregard of its fourth vital condition, that is, passing the test of roadworthiness. On receipt of the licence, Maruti Ltd stopped the supply of fuel and oil it was required to give to VRDE for the continuation of trials for another four months. VRDE was instructed to return the prototype to Maruti Ltd. It did so on June 14, 1975.