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L'Affaire de Karachi
On Wednesday 8th May 2002, around breakfast time in the heart of Karachi’s elite hotels district, a car loaded with explosives rammed into a minibus in front of the Sheraton, claiming the lives of eleven French nationals and three Pakistanis, and leaving 23 wounded. The minibus occupants, employees of the French state-controlled warship maker Direction des Constructions Navales, or DCN, had just set out that morning to the shipyard where an Agosta class submarine was being constructed for the Pakistan Navy. France had won a contract to build three submarines in 1994 for 5.5 billion French francs, or about $1 billion at the exchange rate of the time.
The headlines of the day and subsequent weeks and years were clear in pointing the finger of guilt – typically, “U.S. officials had said they believed the attacks were carried out either by Usama bin Laden's terrorist Al Qaeda network or Pakistani extremists, some of whom have close ties to Al Qaeda” (Fox News). The French Foreign Ministry issued a statement declaring “we are asking the Pakistani authorities to do everything possible to identify and punish the perpetrators of that terrorist act and assure them of France’s full cooperation in that task.”
Eight years later, a different and sordid story of French political corruption and ruthlessness is beginning to emerge. The French paper Le Monde on 17th November 2010 reported that “the former French minister of defence under Jacques Chirac, Charles Millon, has confirmed on Monday 15th November, in front of Judge Renaud Van Ruymbeke, the existence of retrocommissions as a margin on the contract agreed in 1995 for the sale of submarines to Pakistan”. The French daily then added that a former member of French intelligence, the DST (Defense and Security of the Territory, equivalent to MI5), has connected the stoppage of these commissions with the fatal explosion of May 2002.
Apparently on winning the contract, the submarine builder DCN had diverted the kickbacks (coyly referred to as ‘retrocommissions’) to two companies based in Luxemberg. Some of these monies were then diverted by middlemen in the deal to finance the French presidential campaign of Edward Balladur in 1995. Cash of the value of 10 million francs was made available! And who was coordinating Balladur’s campaign? The future President Sarkozy, then the minister responsible for budgets.
According to Luxemberg police, one of these slush fund companies, ‘Heine’, was supervised “directly” by Sarkozy. In order to hush up the scandal, Heine’s managing director Jean-Marie Boivin, was relieved of his services and offered a ‘compensation’ of 600,000 Euros. Boivin was not satisfied with this amount, and asked for 8 millon Euros. The French president of the day, Chirac, then apparently directed some former agents of another French intelligence agency, the DGSE (Direction General of External Security, equivalent to MI6), to apply some more obvious physical pressure!
When the flow of monies to their originally agreed recipients stopped, there was a settling of scores at the Sheraton.
Corruption at home begets corruption overseas. State-run companies like DCN (and BAE Systems in Britain) have chosen to nurture a culture of bribery and kick-backs. L’Affaire Karachi plumbs new depths: the underhand means to further political ambitions, with a callous disregard of the consequences.
In this case, violence and terrorism in the streets of Karachi had a ‘Made in Europe’ label.