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Indian agents raid former finance minister’s home

Indian agents have raided the home of the country’s former finance minister as part of an investigation into alleged violations of strict foreign investment rules.

India’s Central Bureau of Investigation said it had visited locations in the southern city of Chennai on Tuesday morning, including the home of Karti Chidambaram, which he shares with his father P Chidambaram, a Congress party politician whose most recent cabinet post was as finance minister from 2012 to 2014.

The CBI said its officers had also searched locations in Delhi, Mumbai and Gurgaon — the business hub to the south of the capital.

A statement from the bureau said: “[The] CBI is conducting searches at locations in Mumbai, Delhi, Gurugram [Gurgaon] and Chennai, including the residence of Karti Chidambaram, in connection with criminal misconduct in [the] grant of [an] FIPB approval.”

India has strict laws governing foreign investment into the country, with many transactions having to be cleared by the Foreign Investment Promotion Board. The government has announced it will abolish the FIPB in an attempt to encourage more foreign capital to flow into the country.

The CBI would not say which FIPB approval it was investigating.

However, in April the government’s enforcement directorate issued a notice demanding that Karti Chidambaram explain the sale to foreign investors of about Rs450m ($7m) worth of shares in a company called Advantage Strategic Consulting Private Limited. The directorate said Karti Chidambaram appeared to have been the ultimate beneficiary of that sale.

At the same time the organisation said it was investigating P Chidambaram for granting investment approval for the 2006 sale of Indian phone company Aircel to Malaysian telecoms group Maxis.

P Chidambaram told the Financial Times he did not believe it was the Aircel-Maxis merger that was being investigated, but another approval he had given while in government. He did not name the deal and said he had “no recollection of the details or facts” of that case.

In a statement, he added: “Every case was processed according to law and approval was granted or refused in accordance with the recommendations of the FIPB consisting of five secretaries of the government of India.

“The government, using the CBI and other agencies, is targeting my son and his friends. The government’s aim is to silence my voice and stop me from writing, as it has tried to do in the cases of leaders of opposition parties, journalists, columnists, NGOs and civil society organisations. All I will say is, I shall continue to speak and write.”

Mr Chidambaram is one of the opposition Congress party’s most prominent figures. He has been finance minister four times and also home affairs minister and is a member of the upper house of parliament. He has been an outspoken critic of the current Bharatiya Janata party government, led by prime minister Narendra Modi.

He has also been the target of litigation by Subramanian Swamy, the BJP politician, who is investigating allegations of corruption in the granting of 2G telecoms licences by the government in 2008.

Tom Vadakkan, a Congress party spokesman, told Reuters: “This is clearly a fishing expedition launched by the Modi government against Chidambaram.”

Via FT