Oct 15, 2000

The Hinduja Enigma.
As diplomatic absences go, it was as conspicuous as Sherlock Holmes’s dog that did not bark. But the Diwali party that the Hinduja brothers hosted at the Alexandra Palace in London last year was so lavish and with so many celebrities, that the absence of one man in a bandh-gala coat did not seem to matter.

There was Prime Minister Tony Blair with a resplendently-dressed Cherie. She was wearing an orange-and-white embroidered salwar-kameez that may have cost £1,000. The costume was designed by Nita Lulla, who is among Britain’s best-known designers, and it was hand-picked by Srichand Hinduja's daughter. Also present was the leader of the Liberal Democratic Party, Charles Kennedy. So was Peter Mandelson, Blair’s Man Friday, about whom Srichand Hinduja once famously said “Mandelson is sharp, decisive and has a good grasp of the issues. Every businessman likes politicians like that." Rounding off the heavy-duty guest-list was Jeffrey Archer, who was then still aspiring to be London’s first elected mayor, months before an old scandal returned to haunt him and ruined his candidacy, leading to his expulsion from the Conservative Party, and now he faces another humiliating trial on charges of perjury. Britain’s highest-ranking Asian politician was also there, the minister Keith Vaz, who!
 gave an effusive speech.

The notable absentee was Lalit Mansingh, then India’s high commissioner to Britain, and now its foreign secretary. Why would the chief representative of the Indian government not attend a Diwali party hosted by Britain’s eighth-richest family,(in 1999 worth £1.3 billion, or ranked 468th in the Forbes magazine beauty contest of the richest, easily making them among the richest Indian families in the world)?

While Hinduja parties are not recommended to the thirsty, as they are not likely to flow with liquor (the Hindujas are teetotallers), they are elegant affairs. The family is known to moor a yacht off Cannes during the film festival each May where they host celebrities and film makers. Back in 1994, while in Nice writing about the Asian Development Bank’s annual general meeting, I was at a presentation of the Indian government. Probably mistaking me for an official or a Citibanker, a Hinduja associate invited me and another colleague to dinner at the Cannes villa of the family. It was an offer too good to refuse, so we did not make the necessary full disclosure that we were far-east based correspondents of financial publications, and decided to see how the other half lived. (They live well, thank you, with blonde apsaras serving you delicious vegetarian food, overlooking the sparkling Mediterranean at the foot of the terraced slopes of Cannes).

But in 1999, Lalit Mansingh was made of firmer resolve than we were in 1994 (which is probably why he is now the foreign secretary and we are not), and he skipped the Hinduja Diwali party. Why?

The answer lay in the events of this week. After years of dilly-dallying, the Bofors bribery case, which moved at the pace of a Thane Local, has finally picked up the speed of Rajdhani Express, and the Central Bureau of Investigation has charged three Hinduja brothers with criminal conspiracy.

Back in 1986, India bought 400 howitzer field-guns from Bofors for $1.3 billion. Within months, Swedish radio claimed that £30 million-worth of kickbacks had been paid as commission to people associated with the deal, including government officials in India. Prime Minister Rajiv Gandhi first denied that such bribes had been paid, then the commissions came to be called winding-up charges, and finally, those making the allegations were denounced as traitors. (Simi Garewal, who had made a gushing documentary about Rajiv, said: "What's the value of 64 crores? It is less than even a building in Walkeshwar (a posh area of Bombay). You think Rajiv would be interested in that?)

The Gandhi-appointed inquiry that followed revealed nothing, which meant the burden of uncovering the facts fell on the Indian Express and the Hindu. Gen Sundarji, then army chief, raised questions about the acquisition, and defence minister Vishwanath Pratap Singh resigned from the cabinet.

In June 1988, the Hindu published documents from the Swedish auditor-general’s office which identified shell companies that had allegedly channelled Bofors' commissions. Among the firms named, some had links with the Hindujas.

The Hindujas were outraged. "We completely deny that any such payments were ever received by our company or by any member of the family," they said then. They called the documents false, a part of a plot by their rivals. The Swiss in any case froze six bank accounts, but the case was deadlocked through the 1990s.

The Hindujas have maintained they have never dealt with arms deals. They say they have resisted making full disclosure because such records would only give incomplete information. They have added that the Swiss authorities had already concluded there was no basis for a prosecution, and that the Indian police had failed to obtain clarifications from the Swiss authorities which would establish that the payment had no connection with the Bofors gun deal and no payments were made to any public servant or politicians.

That’s a matter for the courts to decide. If convicted, they could face a jail term upto seven years. Of course, for any of that to happen, first of all the government will have to successfully appeal to the British government to extradite the brothers, and then, prove the case before the courts.

Britain’s Home Office can’t act until a formal request is made to extradite the brothers who were granted British citizenship only last year, partly in recognition of their contribution to the British society. This presumably included a donation of £1 million to bail out the Faith Zone, a dull part of the megaflop attraction, the Dome which has been astutely called “the carnival of vacuity” by the journalist Nick Cohen. (They were willing tp pay more, but Christians balked). The Dome, in any case, has been a disaster of magnificent proportions, and it will mercifully be put out of misery at the end of this year after wasting millions of pounds. Ironically, Hindujas were granted citizenship within days of the British government rejecting, for the second time, an application for citizenship made by Mohamed Al-Fayed, the owner of Harrod’s (and more famous as the father of Dodi Al-Fayed, Princess Diana’s plaything who died with her in that reckless car crash in August, 1997.)

Despite their proclivity to host opulent parties, their ownership of plush apartments in Carlton House Terrace off the Mall (not far from Buckingham Palace or the Downing Street, I might add) and other homes around the world, their ability to invite sought-after guests, their friendship with politicians ranging from George Bush and Margaret Thatcher, and it must be said here, the late Shah of Iran, and their hobnobbing with entertainers like Michael Jackson, the family has shunned publicity. The day the CBI pressed charges in India, all a Hinduja spokesman in London would say was: “There has been enough trial by press in this matter. It is time for the law to take its course. The three Hinduja brothers are relieved that they are no longer at the mercy of the political pressures that have ruled this case for the past 13 years and that the judiciary will now make the correct decision. They are law-abiding persons and as in the past they shall abide by the legal process.”

There is of course nothing wrong with shunning publicity: given the kind of 15-minute-wonders who strut and fret their time on the stage, it might even
be a desirable virtue. But given the persistent questions about their role and business dealings, the curiosity about who they are is natural. I remember in mid-1980s, in my days as a correspondent in Bombay, I would run into Ashok Hinduja, the youngest brother, at parties. After finding out what I did for a living, he would slip away from our sight.

That tendency to shun outside contact is not something new. The Hinduja House on Worli Sea Face in Bombay personifies it. For years, when you drove from the Mahalakshmi Temple towards Worli, you saw an unmarked building with reflecting glass, in which you could see fascinating glimpses of the magnificent clouds over Haji Ali, but little else. There was no name outside that smart building. People inside could see you, but you couldn’t see anything of the building flanking the Nehru Planetorium.

That’s an apt metaphor for the Hinduja family, and the image it creates is of a man with dark glasses which reflect your face but show nothing of his eyes. Not very comforting.

But now that the family has made acquisitions of public companies, we now know something about their businesses. Besides Ashok Leyland and IndusIndBank, they have interests in Lufthansa Cargo and Gulf Oil, and their other businesses range from film, finance, telecommunications, and oil.

It all began on the banks of the River Indus, at the beginning of the 20th century, when Parmanand Hinduja, the father of the brothers, decided to move from Sind to start a business of importing and exporting dried fruit and tea to Persia. Parmanand soon diversified into other businesses, including distributing Indian films, dubbed in Farsi. By 1919 he moved to Tehran, but the family made its major business advances in the 1960s and 1970s, when Reza Pahalvi, the Shah of Iran, decided to recreate the glory of the old Persian empire. He wanted to build world class infrastructure in his country. Iran wanted top quality goods and services, and Hindujas provided them. There has been widespread speculation that the Hindujas supplied the Shah with everything, including weapons, but that allegation has only remained an allegation and never proved; and the Hindujas have steadfastly maintained that they’ve dealt with everything except weapons.

After Parmanand died in 1971, Srichand Hinduja, the eldest son, took charge of the business. He moved the family empire to London after the 1979 revolution in Iran. Since then, they’ve expanded into other businesses, including taking over companies in India and abroad. They have also made handsome donations to charitable causes, which include a quarter-million-pound contribution to erect the Swaminarayana Temple in London, the biggest Hindu temple in Britain. The ascetic, vegetarian brothers have shunned alcohol and tobacco, and they are known to carry home cooked food to parties where they are not sure if their vegetarianism might get compromised.

But for a family that believes in avoiding publicity, and which professes not to finance politicians, they have been eager cultivators of politicians as friends. They have attended Conservative fund-raising parties for Thatcher and her successor John Major, says Cohen, “before finding, along with many other rich men, that the transition from old Conservative to new Labour could be painless.”

At the Alexandra Palace party, Srichand said that he wanted to contribute to the Dome because, "I don't agree when we talk about Hindus or Christians, because we are all human beings. It's only which faith people follow that has created differences between us." (Those differences can prove fatal, as a family tragedy, painful to recall, shows too well. About a decade ago, Srichand’s son Dharam decided to marry a girl from another faith, and eloped with her to Mauritius. The family placed advertisements in newspapers in Mauritius, in order to track them down, and the young couple decided to end their lives, in a style befitting Bollywood which the Hindujas are believed to fond of, by dousing themselves with petrol and setting themselves afire. Dharam died).

Incidents like that, the prominent people with whom they are seen, the donations they make, and the publicity that follows them like a star-struck fan, have finally coalesced, casting the spotlight on the family once again. And the questions raised by the long-winded saga of Bofors guns may finally get resolved.