India Selling Secrets for a Song

By Marguerite Johnson

What next? After the shocks of the past six months, including the assassination of Prime Minister Indira Gandhi and a leak in a chemical plant in Bhopal that killed more than 2,500 people, Indians were stunned last week by yet another national crisis. This time the bombshell was the exposure of an espionage network that had penetrated to the highest reaches of the government. Before clamping a tight lid on details of the investigation, India's youthful new leader, Rajiv Gandhi, whose Congress (I) Party won a sweeping majority in national elections only a month ago, gravely informed Parliament that the country's security had been compromised by a spy scandal that he characterized as "the most serious ever."

Thus far, at least 15 government officials and three businessmen have been arrested and charged with violations of the Official Secrets Act and criminal conspiracy against the government. Several of them were officials in the defense and commerce ministries, and three men held key positions in the Prime Minister's secretariat. Among them: T.N. Kher, the personal assistant to P.C. Alexander, a top aide to both Indira and Rajiv Gandhi and one of the country's most respected civil servants. Alexander, who was not connected to the espionage activity, resigned after accepting "moral responsibility" for the leakage of hundreds of files from his office. At least 60 other people were under surveillance or being questioned by authorities.

The government is unlikely to disclose what secrets were compromised. But in his position close to the Prime Minister's office, Kher would have had access to all the secret files concerning defense, foreign policy, nuclear power and the entire range of official activity. The Hindustan Times, New Delhi's largest English-language daily, reported that documents handed over to foreign agents from the Defense Ministry "staggered the imagination of investigating officials." Said a senior investigator: "The security system and our vital papers have been stripped clean."

New Delhi carefully refrained from naming foreign governments that might have received classified information. But the French, who have landed Indian defense and industrial contracts worth more than $2 billion in the past few ( years, were linked to the operation. The French deputy military attache, Colonel Alain Bolley, hastily left New Delhi after the Indian government asked for his recall. Bolley was alleged to have ties to the CIA. In Paris, French Foreign Ministry officials refused to comment on the case.

The current investigation was apparently triggered last September, when reports in U.S. newspapers, based on leaks from a CIA briefing to a congressional committee in Washington, said that New Delhi had considered a pre-emptive strike on a Pakistani nuclear installation before it was capable of producing nuclear weapons. The proposal had been firmly rejected by Mrs. Gandhi, and Indian intelligence officials, as one remarked, "smelled a rat." After Mrs. Gandhi's assassination by two of her own bodyguards six weeks later, intelligence agencies underwent a major shake-up. When routine surveillance aroused suspicions about some officials, intelligence officers met with Rajiv and informed him they had evidence against some employees in his own secretariat. He told them in effect to let the chips fall where they might. In raids on the homes and offices of the suspects on Jan. 18, agents turned up what one report described as "trunkloads" of copied documents.

A key figure in the network was said to be Coomar Narain, a businessman representing the Bombay-based Maneklal Group of Industries, which is involved in government military contracts. Narain entertained lavishly around New Delhi, cultivating contacts with government officials. He apparently persuaded some of them to photocopy secret files in return for nominal payments. Some staffers, who admitted using the photocopy machine in the Prime Minister's office, told police they received no more than $300 for a transaction and usually only $40. Sometimes payment was just a few bottles of Scotch. Said a dismayed senior official: "It seems the nation's top secrets were sold for a song." The identities of Narain's foreign contacts have not been disclosed, but the CIA, the KGB and Pakistan, all implicated in previous Indian espionage cases, were mentioned.

Except for a brief appearance before Parliament to debate his government's new policies, Rajiv devoted all his attention to the espionage case. He ordered a thorough review of security procedures and a revamping of the intelligence services. All major economic and defense agreements made during the past three years will be re-examined for evidence of malfeasance. For the , new Prime Minister, the investigation was already proving to be a far more formidable task than he could have anticipated when he announced that he would put an end to corruption in public life. Indeed, by the time the books are closed on the case, Indian authorities believe that not only espionage but many other crimes will have been exposed.

With reporting by William Dowell/Paris and K.K. Sharma/New Delhi