U.S. report cites illegal payments by firms to Indian entities


A United States government report on corrupt practices, released in May this year, mentions “illegal payments” to several Indian entities, including state-owned enterprises, by American companies. These firms have admitted to wrong-doing and paying of bribes to secure orders.

The Indian Navy, employees of the Maharashtra State Electricity Board, the Railways, the Central Insecticides Board and a “government official” have been mentioned as bribe receivers during 2000-06, covering the National Democratic Alliance regime as well as the United Progressive Alliance rule at the Centre.

Ambassador in Washington Meera Shankar had written to T.K.A. Nair, Principal Secretary to the Prime Minister, on May 12, 2009, a day after the U.S. report on Foreign Corrupt Practices and Anti-Corruption Enforcement 2008-09 was released.

It was confirmed by an official in the Prime Minister’s Office that Mr. Nair had indeed received the letter from Ms. Shankar detailing the bribes received by Indians as uncovered by the report. The two-page letter, released to the press here on Monday by Bharatiya Janata Party spokesman Prakash Javadekar, details references to India and Indians in that report while pointing out that in some instances American companies, including Dow Chemicals, admitted to “improper payments” and agreed to pay penalties for their misdemeanour.

After detailing the references to payments to Indians, Ms. Shankar ends the letter to Mr. Nair with: “You may like to take appropriate action to have these investigated at your end.”

The details of bribes received by Indians are as follows:

The payments to Indian Navy “officials” is the most startling. Small sums of around $1,000 were paid over 6 to 7 years from 2000-06 by agents of York. The total sum paid amounted to around $1,32,500. The company dealing with heating and refrigeration equipment paid the bribes to secure 215 contracts, Ms. Shankar had written quoting from the U.S. report.

International Corporation agreed to pay fines under the American Foreign Corrupt Practices Act. It has admitted to paying bribes to secure orders in the Middle-East, China, Nigeria, Europe and India.

It seems York retained an agent in India for its operation to help secure after-installation service contracts and provide sales and marketing support in connection with equipment sold to the Navy. An employee of the agent admitted to making “routine payments” to Navy officials to secure business for York between 2000 and 2006.

Employees of the Maharashtra State Electricity Board also received “illegal payments” from the American company Mario Covino of Control Companies Inc. This company, dealing in industrial valves, has pleaded guilty to bribing officials in four countries. Over $1 million was given as bribe by this company to entities in four countries.

Employees of the Indian Railways received $ 1,37,400 between 2000 and 2005 — covering mostly the National Democratic Alliance tenure. Westinghouse Air Brake Technologies Corporation (WABTEC) admitted to bribe-giving. It pleaded guilty, saying its Indian subsidiary, Pioneer Friction Ltd., made illegal payments to employees of the Railways.

Details of several other scandals involving bribe giving have been listed. Dow Chemicals paid $ 2,00,000 in India, including over $39,000 to an official of the Central Insecticides Board to expedite registration of three of its products, $ 19,000 to government business officials, $ 11,800 to sales tax officials, $ 3,700 to excise tax officials and $ 1,500 to customs men.

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Printable version | Dec 14, 2019 8:14:38 AM |

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