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Saturday, November 12, 2005

The oil-for-influence program

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Saddam Hussein had plenty of funds and contractual goodies to dole out to the prominent and illustrious around the world willing to hawk their influence on behalf of the dictator, according to the latest report on the U.N. oil-for-food program. The Independent Inquiry Committee investigating fraud and abuse under the U.N. program has pointed to India's Natwar Singh, who has been stripped of his former position as foreign minister, as such a potential influence peddler.

India's response to the report was initially underwhelming, but the government has since taken the charges more seriously. It remains to be seen if India will allow the full glare of accountability to shine upon Mr. Singh. The country's strengthening international credibility is at stake.

According to the report, Mr. Singh and the ruling Congress Party were "non-contractual beneficiaries" of Iraqi oil sales under the oil-for-food program, which was implemented from 1996 to 2003 to ease the impact of U.N. sanctions on ordinary Iraqis. In other words, Mr. Singh and other Congress Party officials allegedly sold their rights to buy Iraqi oil to another party, according to documents from Iraq's Ministry of Oil. The report lists Masefield AG, a Swiss firm, as the company that handled the transactions. Masefield is apparently owned by Marc Rich, the billionaire oil trader and former U.S. fugitive pardoned by Bill Clinton in his last days in office.

Although the report devotes entire sections to other political and high-profile individuals -- such as Mr. Rich, former French Interior Minister Charles Pasqua and British parliamentarian George Galloway -- it does not outline in detail the alleged corruption of Mr. Singh and the Congress Party. The head of the IIC, former Federal Reserve chief Paul Volcker, said he was not aware of Mr. Singh's political post when the committee published the report.

Mr. Singh has suggested that he was the victim of a politically motivated ploy to incriminate him. "I opposed sanctions, I opposed the war and I opposed sending Indian troops to Iraq," he said, claiming he was therefore targeted. There are any number of politicians around the world, though, that opposed the war and have not shown up on Iraqi government ledgers as having profited from Saddam's manipulation of the oil-for-food program.

India's Prime Minister Manmohan Singh initially attempted to shrug off the damning information. The prime minister said the facts regarding his former foreign minister are "insufficient" to warrant "any adverse conclusion." He also called the references unsubstantiated, adding, "There is no evidence. Anybody can write names." His conclusions seem premature, and do not inspire much confidence in the government's determination to seek the truth about the allegations.

The IIC is not tasked with a prosecutorial role. Sovereign countries are expected to conduct their own investigations of the businesses and individuals implicated by the report, and prosecute accordingly. On Thursday, the Indian government announced an independent investigation of the information in the report, to be led by a retired chief justice of India's Supreme Court. There is great skepticism in India as to the likelihood of an independent investigation, particularly since Mr. Singh remains in the cabinet as a minister without portfolio.

At the time Mr. Singh and his party allegedly profited from Saddam's manipulation of the oil-for-food program, the Congress Party was in opposition in India. The government at the time, under Prime Minister Atal Behari Vajpayee, pressed for a peaceful solution in Iraq, but took a so-called middle position after the war began, neither condemning it nor supporting it. Some Indian officials suggested that the Indian position on the war was up for negotiation with U.S. officials, depending on U.S. policy towards its longtime rival, Pakistan.

India in recent years has risen in international stature and its relationship with the United States has steadily improved. Still, New Delhi must take additional action to bolster Indian credibility. Transparency International, the Berlin-based corruption watchdog, has placed India 88th among 159 countries on the corruption scale. India, particularly under Congress Party leadership, must take pains to ensure that its officials are serious and honest, and not in the corrupt employ of foreign governments. The government should start by allowing a full and thorough investigation of the information in the Volcker report.

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