‘Indira Govt paid $6m as bribe for Iran loan… Nepal offered asylum to her after Emergency’

In his book, Inside IB and RAW, The Rolling Stone That Gathered Moss, which spans his entire career, Nair — he had a long stint in the Intelligence Bureau too — recalls how he was asked by Congressmen to look for Indira Gandhi’s slippers to more scandalous details like an alleged effort by some politicians to get former Army doctors to study the use of drugs by East German athletes to replicate that for Indian sportspersons for the Asian Games.

Nair’s book is published by Manas Publications, which was recently raided by the CBI for publishing another ex-RAW official V K Singh’s book.

In his book, Nair, who now lives in London, details his version of the events in response to allegations that he had paid $6 million into a Swiss bank on behalf of Sanjay Gandhi.

Nair says he was involved “purely as a courier” in depositing money that came from the funds of the Ministry of External Affairs on behalf of the Finance Ministry after due clearance from the PMO.

For some reason, the MEA was not keen to involve its own mission there. “Originally, Gopi Kaul, the Finance Secretary, had asked me to take the money in $100 notes,” writes Nair, “which would have meant carrying five Samsonite suitcases. I flatly refused…so Kaul got the Reserve bank to telex its correspondent bank in Geneva to issue a personal cheque to me. This cheque was deposited in the numbered account given to me by Kaul.”

When the telex got out, it created a furore and that was when Nair discovered the truth of what was called “Operation Casino”. He discloses that after the 1974 nuclear tests, the Shah of Iran “developed respect” for Indira Gandhi despite his earlier inclination towards Pakistan. This led to the Shah sanctioning a “large loan” on soft terms towards the Kudremukh iron ore project.

“When Kaul, the Finance Secretary, went to negotiate the loan he was helped by some well-known local Indian businessmen and wheeler-dealers of Iran who had come close to Sanjay Gandhi and the House (Gandhi family) — Kaul wanted $250 million over and above — as a straight loan to tide over our serious foreign exchange shortage.”

While the Iranian Finance minister was against this, Nair writes, the loan was sanctioned through the help of Rashidyan, a local financier who was a close friend of the Shah’s sister Ashraf Pehlawi.

“The six-million dollar payout in Geneva was a kick-back to Rashidyan and his associates for having procured the loan. This had been sanctioned by Government of India. My eyes popped out in amazement when Narasimhan (RBI governor under Morarji Desai) told me these startling facts. He reported back to Morarji and the ‘Operation Casino’ file was closed.”

Besides this, Nair reveals that such was the fear of backlash following the 1977 elections that Indira Gandhi was considering sending Rajiv Gandhi and his family to Nepal. “The Janata Party was out to wreak political vengeance. Mrs Gandhi was on the point of sending Rajiv and his family to Kathmandu, in response to the offer of the King of Nepal to give them asylum.”

However, Ramji Kao, from whom Nair took over as RAW chief, prevailed over Indira Gandhi and advised her family against leaving the country, Nair writes.

After retirement, Nair was recalled to help organize the 1982 Asian Games. And he recalls how V C Shukla, who was chairman of the organizing committee fell out with Indira Gandhi and then lost this job to Buta Singh. This led to Nair’s elevation as the Secretary General of the committee.

He recalls that two retired doctors from the Armed Forces approached him and said they had been sent by ex-chairman V C Shukla, requesting two free Air India tickets to visit East Germany asked for the reason, Nair writes: “They said that they had been asked to study the successful use of drugs in that country for enhanced performance by athletes so that similar action could be taken here to ensure medals for India in the ensuing games.” A “shocked” Nair says that he asked officers to leave and rejected the “preposterous” request.