Rana Dasgupta - Capital - The Eruption of Delhi

“When the Athens Olympics were going on,” said a foreign official involved with the Games, “there was a lot of corruption, but the objective stayed fixed. Everyone was intent on producing the games to the requisite standards. In Delhi, the administrators were entirely willing to compromise the Games themselves. The objective was not the Games at all, in fact.

“Look at what happened with the catering contract. The tender was put out and won by an American company, which was just about the only company in the world that had the expertise to camp in Delhi and produce 8,000 meals a day to the quality necessary for athletes. But they refused to pay 10 per cent to the chairman of the organising committee.

“He sat on it for a while. When they still didn’t pay up he threatened to re-open the tender. His advisers said this would be fatal because months would be lost and the entire Games could be threatened. Without a caterer there are no Games. They also warned that it would inevitably go to the same company, who would then charge a higher price. But he went ahead and issued the tender again, citing some technicality against the American firm.

“Seven months were lost. Eventually, the contract went back to the same company. What’s more, the British company that was going to rent the kitchen equipment now retracted their rental offer and said that everything would have to be bought. Not only that, but there was no longer enough time to ship the equipment over so they had to fly it in. They tried a 747 but it was too small, so they had to rent an Antonov, the largest carrier aircraft in the world, to bring it in. You can imagine what kind of cost escalation all that entailed.

“There were four main ways that people made money out of Commonwealth Games contracts. The first involved awarding them to oneself or to one’s family members. Even if this happened they would not then stop at the legitimate profits that could be earned on these contracts. They would massively inflate the prices and supply only a cardboard cut-out version of what they were supposed to supply — which is why so many roads and buildings were collapsing just before the Games.

“The venues are built to such a pathetic standard that it’s all just trash. Usually when you do these events, there are immediate benefits — like tourism and international prestige — and then there are long-term benefits, which consist mainly of the physical legacy. From the Delhi Games there will be no long-term benefits, because the quality of the buildings has been massively compromised. The steel they provided for the frames, for instance, was of very low quality because of money extraction. So the buildings began to buckle. Enormous money then needed to be spent hiring foreign engineering consultants to re-inforce the buildings.

“The second way to make money was to take a percentage of everything in a certain turf. That’s why organising committee meetings always felt like an assembly of gangsters, because they were dominated by turf wars. Many stoppages in the process, which appeared incomprehensible to outsiders, were about conflicts over turf. For instance, one person took 10 per cent of all hotel bookings. That person managed to ensure that the accommodation that was supposed to be built for visiting officials was never approved, so that they had to stay in hotels throughout. The entire form of the Games, in fact, was determined by the structure of internal money-making.

“The third way was to accept bribes for awarding contracts. Administrators made a lot of money in this way, which businessmen obviously had to make back either by inflating the cost of what they supplied, or by supplying sub-standard goods.

“And the fourth way to profit from the Games was simply to steal all this equipment which had been bought at such inflated cost. Much of it disappeared afterwards. Some was taken by the Delhi police, who used furniture and computers for their offices. In other cases the police may have been paid by someone else to take it. Flat screen TVs disappeared, world-class gym equipment. This was helped by the fact there was no inventory of anything. So no one could prove afterwards that something was missing. The entire Commonwealth Games was run on individual computers and private email addresses: there was no central server. This was not just incompetence: it was a deliberate strategy to ensure there was no systematic information. Another thing that was stolen was hard drives. People turned up in the morning to find their entire data gone. I believe this was a deliberate attempt to erase the data trail. The budget of the organising committee simply disappeared, for instance, and this could happen because the management systems were deliberately inadequate. Decision-making was completely fudged and money disappeared through the gaps.”

There were endless rumours as to where this money went, but most people imagined that it was being used to strengthen the grip with which the corrupt elite held onto society and its resources. Some would undoubtedly be used to fund politicians’ re-election campaigns, some to invest in new business ventures. But a major slice of it the middle classes could detect for themselves, because each time a new tranche of the Commonwealth Games budget was released, it sent Delhi property prices leaping further out of their reach. Delhi’s property market, in fact, was not like those of other places. Delhi property was a sink for billions of dollars of corrupt money, which could not be stored in banks, and this was why prices bore so little relationship either to the nature of the building or indeed the buying power of ‘ordinary’ people. The media reported those moneymakers who set themselves up in $8 million homes during the Commonwealth Games preparations, but this was just the sensational iceberg tip; most of the money was invested in more discreet purchases — a few $500,000 apartments here and there — which brought the financial elite head-to-head with the middle classes, to the increasing disadvantage of the latter.

At the beginning of the decade, it had still been possible for the middle classes to imagine buying property in Delhi. But by the end, the formula had become impenetrable even to very successful corporate employees. Leave aside the mansions selling for $30 million and $40 million: newly built three-bedroom apartments in south Delhi, even relatively ordinary ones, cost half a million dollars, which was out of all proportion to all but the highest salaries. Not only this but, considering the fact that these properties suffered from all the normal Delhi problems — poor-quality construction, power cut-outs and water shortages — this seemed dismal value for money compared to what that money could buy even in London or New York. Much more than this, however, was the fact that in order to buy property in Delhi you had to come up with some 50 per cent of the price in cash. Now, clearly it was not those who worked in the brightly shining corporate economy as PR executives or TV newscasters who could lay their hands on a million dollars in cash. No: the people with the suitcases of cash were, as likely as not, black money businessmen, criminals, or corrupt public servants. These were the people who expanded their hold very substantially over the physical assets of India’s capital during the first decade of the twenty-first century, and if there was a shift in the feeling of the city, towards something darker and more lawless, it was in part because of this. It was generally entertaining to ask restaurant owners who their landlords were: for it was a Who’s Who of India’s black money elite, from paid assassins working for the Mumbai mafia to publicly pious politicians. The professional classes, meanwhile, had no choice but to move out to the new suburbs of Gurgaon and Noida, where the corporate ethos meant that the quoted price was pretty close to the real price, and people with salaries could get a loan to cover their purchase. In practice then, the beginning of the twenty-first century saw a substantial hand-over of India’s capital from those who had acquired property after 1947 to a new black money elite, and it was this group that increasingly set the tone — aesthetic, commercial and ethical — for everyone else.