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Judicial probe over Volcker's report
by Maya Singh

     New Delhi: Facing increasing pressure from the opposition, the Manmohan Singh Goverment on Monday announced a judicial probe into the Volcker Inquiry Report that alleged that the Congress party and the External Affairs Minister K Natwar Singh were indirect beneficiaries of the Iraq Oil for Food deals. Former Chief Justice of India R.S.Pathak will head the judicial probe, said the Prime Minister's Media Advisor, Dr. Sanjaya Baru. "Mr.Justice R.S.Pathak, former Chief Justice of India and a former judge of the International Court of Justice, The Hague, will head the Inquiry into matters relating to the Report of the Independent Inquiry Committee appointed by the Secretary General of the United Nations to inquire into the UN Oil-for-Food Programme. The scope of the Inquiry and the Terms of Reference will be announced shortly," Dr. Baru said in a statement issued on behalf of the Prime Minister. The commission of inquiry is likely to investigate the antecedents and activities of Hamdan Exports, the export agency at the heart of the controversy that has dogged newspaper headlines in India for the past three days. On Saturday, the government had announced that it would be conducting a fact-finding probe into what it called "unverified" references to Natwar Singh and the Congress party in connection with the scam.

     On Sunday, the government appointed former diplomat and former U.N. Under Secretary-General Virendra Dayal as the head of an independent inquiry committee to carry out an indepth study of the Volcker report. As a special envoy of the government, Ambassador Dayal will liaise with the UN and its members to collect the relevant material. Dayal, a former Chef de Cabinet of the UN Secretary General Pervez de Cuellar, has been granted full power and authority by the Indian Government to execute the responsibilities entrusted to him. His appointment will be for an initial term of three months or until the completion of his task, whichever is earlier, according to official sources.

     Meanwhile, a National Democratic Alliance (NDA) delegation led by Bharatiya Janata Party (BJP) president L K Advani is scheduled to meet President A.P.J. Abdul Kalam this afternoon to demand the resignation of Natwar Singh from Union Cabinet. Natwar was called in by the Prime Minister on Sunday to discuss the matter once again, but he ruled out rumours suggesting that he was planning to resign. According to sources, Manmohan Singh is still standing by Natwar Singh and said that the Volcker report was insufficient to arrive at any conclusion. So far, the Congress party has rubbished the BJP's demand of Central Bureau of Investigation (CBI) enquiry into the matter, saying that the BJP has no authority, moral or democratic, to ask for Natwar Singh's resignation. The Enforcement Directorate, which is under the Union Finance Ministry is continuing with its questioning of Delhi-based exporter, Andaleeb Sehgal. Andaleeb Sehgal, Export Director of Hamdan Export, who is said to be a friend of Natwar Singh's son, Jagat Singh, was interrogated by a team of officials on Sunday and his various premises in the Indian capital were raided. Reports said that on behalf of Sehgal's firm, a Swiss company Masefield AG lifted oil barrels under allotments to now ruling Congress party and Natwar Singh in 2001. The report by the UN-established Independent Inquiry Committee, led by former US Federal Reserve Chairman Paul Volcker said, politicians in several countries were given oil vouchers that could be sold for a commission to help the former Iraqi leader in his attempt to get sanctions lifted. Volcker also has claimed that everyone listed was given a chance to clarify. The report says that, so strict was the control that the UN determined how much oil Iraq could sell and at what price. Money was credited into an UN-controlled account and was to be used only for humanitarion purchases. The committee has concluded that the Saddam regime awarded lucarative oil contracts to individuals and companies across 66 nations to create a diplomatic and political environment against the sanctions. "Many companies freely went along with Iraq's demands. Others made payments to third parties or agents, while disagreeing the likely purpose of these payments".

     Iraq sold 64.2 billion dollars in oil to 284 companies around the world and then spent 34.5 billion dollars on food and medicine from more than 3,400 companies. About 1.55 billion dollars of kickbacks were recieved -- 1.2 billion dollars as ASSF and 530 million dollars as island transport fees. From the late 2000 to the late 2002 the Iraqi regime imposed a 10-30 cent "surcharge" per barrel of oil. The price fixed for Iraqi oil was lower than the market price, hence buyers were willing to pay kickbacks for buying contracts. More than 4,500 companies have been involved in the UN oil-for- food programme. The country with the most companies involved in the programme was Russia followed by France. The report also says that as many as 119 Indian firms, including several from pharma majors, figure on the list of suppliers of humanatarian materials to Iraq which either knowingly or unwittingly paid kickbacks to the Iraqi regime. The UN food-for-oil scheme began in 1996 and ended in 2003 and under the programme, Iraq was allowed to sell oil to buy food, medicine and other goods to ease the impact of sanctions.

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