India’s Modi faces calls for resignation over French jet deal

India’s prime minister was under fire over allegations of corruption in a military jet deal with France after comments by former French President François Hollande. (Reuters)
Updated 22 September 2018
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India’s Modi faces calls for resignation over French jet deal

  • Indian political parties have been gunning for Modi over the 2016 purchase of 36 Rafale planes from Dassault Aviation estimated to be worth $8.7 billion, saying he had overpaid for the planes and had not been transparent.
  • Political analysts say that the BJP is “losing in the perception war.”

DELHI: India’s prime minister was under fire over allegations of corruption in a military jet deal with France after comments by former French President François Hollande. Hollande was quoted as saying Narendra Modi’s government had influenced the choice of a local partner.
Indian political parties have been gunning for Modi over the 2016 purchase of 36 Rafale planes from Dassault Aviation estimated to be worth $8.7 billion, saying he had overpaid for the planes and had not been transparent.
The opposition, led by Congress President Rahul Gandhi, spent the past year alleging that the deal is a scam, in which India is overpaying for jets and the government is allowing a private company — billionaire Indian businessman Anil Ambani’s Reliance Defense — to benefit instead of state-owned Hindustan Aeronautics Limited (HAL).
On Friday, Hollande, who cleared the intergovernmental deal when he was in office, was quoted as saying New Delhi had put pressure on Dassault to choose Reliance.
“We had no choice. We took the interlocutor that was given to us,” he was reported as telling the French news service Mediapart, fueling a political storm in India.
The Indian government, however, has insisted all along that it had nothing to do with Dassault’s decision to work with Reliance Defense.
Under Indian defense procurement rules, a foreign firm must invest at least 30 percent of the contract in India to help to build up its manufacturing base and wean off imports.
HAL was the sole contender for being the local partner of Dassault Aviation, but when the deal was sealed in 2015 during Modi’s Paris trip the Reliance Defense procured the contract .
“The PM personally negotiated and changed the Rafale deal behind closed doors. Thanks to François Hollande, we now know he personally delivered a deal worth billions of dollars to ...Anil Ambani,” said Mr. Gandhi in a tweet.
Gandhi further tweeted: “The PM and Anil Ambani jointly carried out a ... SURGICAL STRIKE on the Indian Defense forces. Modi Ji you dishonored the blood of our martyred soldiers. Shame on you. You betrayed India’s soul.”
Gandhi repeated the charge in a press conference in New Delhi on Saturday.
The BJP, however, says that there is no corruption.
“The fact that two sovereign heads of States negotiated a deal means that there is no room for corruption,” said Sudesh Verma, BJP spokesperson.
Talking to Arab News Verma emphasized that “the highest integrity was maintained in the deal. Now the Congress is not talking of corruption but favoritism. Merely by saying that Reliance Defense was favored by us would not cut any ice. These are insinuations and are irresponsible.”
Political analysts say that the BJP is “losing in the perception war.”
“No matter what the indian government says that perception is that the Indian government gave the offset contract to Anil Ambani, a guy who has no history of producing defense equipment,” says Nilanjan Mukhopadhyay, a New Delhi based political analyst.
He added: “The halo around Modi has been severely diminished after the recent revelations. This is something which it would be very difficult to live it down now.”


UK firms step up preparations for a ‘no-deal’ Brexit as PM Theresa May meets with EU leaders

Updated 21 March 2019
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UK firms step up preparations for a ‘no-deal’ Brexit as PM Theresa May meets with EU leaders

  • May is meeting EU leaders in Brussels on Thursday in attempt to get support for Brexit delay
  • The Bank of England warned in November that the British economy could shrink by a massive 8 percent

LONDON: UK companies have ratcheted up their preparations for a disorderly “no-deal” Brexit as best they can over the past couple of months, the Bank of England said on Thursday.
With the prospect of a chaotic Brexit potentially eight days away, a survey by the central bank’s agents showed that around 80 percent of companies “judged themselves ready” for such a scenario, in which the country crashes out of the European Union with no deal and no transition to new trading arrangements with the bloc. That’s up from around 50 percent in an equivalent survey in January.
For decades, trading with the rest of the EU has been seamless. A disorderly Brexit could see the return of tariffs and other restrictions on trade with the EU, Britain’s main export destination.
To prepare, some firms have moved jobs and operations to the EU to continue to benefit from its seamless trade. Many have had to learn how to file customs declarations and adjust labels on goods. Exporters of animals are learning about health checks they will need to comply with.
According to the bank’s survey, however, many of those companies preparing for a “no-deal” Brexit said “there were limits to the degree of readiness that was feasible in the face of the range of possible outcomes in that scenario.”
There’s only so much companies can do, for example, to prepare for new tariffs and exchange rate movements.

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Britain appears headed for a “no-deal” Brexit on March 29 if Prime Minister Theresa May fails to win parliamentary support for her withdrawal agreement with the EU.
She is meeting EU leaders in Brussels on Thursday in an attempt to get support for a delay to the country’s departure date to June 30. EU leaders have said a short extension would have to be conditional on her Brexit plan getting parliamentary backing and have indicated they would only be willing to back a delay to May 22, the day before elections to the European Parliament. After two heavy rejections in parliament, there are doubts as to whether she will be able to get parliamentary approval. What would happen next is uncertain.
European leaders, including those from France and Luxembourg, have said any extension will be granted dependent on May's deal passing a third parliamentary vote.
The Bank of England warned in November that the British economy could shrink by a massive 8 percent within months, though Governor Mark Carney has indicated the recession will be less savage, partly because of heightened preparedness.
According to the minutes of the latest meeting of the bank’s nine-member Monetary Policy Committee, at which the main interest rate was kept at 0.75 percent, rate-setters warned “Brexit uncertainties would continue to affect economic activity looking ahead, most notably business investment.”
Brexit uncertainty has dogged the British economy for nearly three years. In 2018, the economy grew by 1.4 percent, its lowest rate since 2012, even during what was then a global upswing. Business investment was down 3.7 percent in the fourth quarter from the year before.
“Business investment had now fallen in each of the past four quarters as uncertainties relating to Brexit had intensified,” the rate-setters said.
The survey showed uncertainty was likely to remain for months, even years, as Britain works out its long-term relationship with the EU. It said around 60 percent of UK firms in February said Brexit was one of their top three uncertainties, compared with 40 percent just after the June 2016 Brexit referendum.
Around 40 percent of firms expect the uncertainty to be resolved only by the end of 2019 and 20 percent anticipate it persisting into 2021 or beyond.