Guptas’ nexus with President Zuma lands them in trouble

Tuesday 15th March 2016 09:01 EDT

Are Guptas the most powerful and influential family in South Africa?

Well, when you fly people across the Indian Ocean in chartered aircraft and you land at an air force base – that says you really have clout in that country, you have influence at the highest level.

To outsiders, the Gupta family may seem an industrious immigrant family that have made it big in their adopted country. One of South Africa’s wealthiest families, Guptas are accused by critics of wielding immense power behind the scenes.

Public anger towards the family soared in 2013, when a private jet carrying guests from India to a Gupta family wedding was granted permission to land at Waterkloof Air Force base, outside Pretoria.

The airport is a military facility that is normally used to receive heads of state.

The wedding party did not go through immigration checks, and were given a police escort to the marriage at a casino resort (Sun City) 100 miles away.

The fact that several ministers attended the week-long lavish ceremonies fuelled further media and public antagonism towards the Guptas.

But it was alleged that the landing of the aircraft was unofficial and illegal – an abuse of a secure military base. And the incident quickly turned into a major political scandal, when it was alleged that “Number One” – a reference to President Jacob Zuma – had personally authorised the whole affair as a favour to friends.

The President denied the allegation in Parliament. An in-house investigation too cleared him.

The Guptas have since insisted that proper process was followed and permission sought from the appropriate officials.

It’s an open secret that the Gupta family, originally from Uttar Pradesh in India, have strong ties with President Jacob Zuma. They have been accused of having sway over government decisions. However, they insist they are not involved in local politics.

In an interview to the Financial Times, both President Zuma and Ajay Gupta, the eldest of the three brothers who run the family empire, have defended their relationship, denying the family had any influence over politics or had benefited unduly from their relations.

“We are business people and we have nothing to do with politics,” said Gupta, in a rare interview.

According to Ajay Gupta, only 1% of the more than R5 billion ($325 million) annual revenue generated from their businesses is derived from government contracts.

“It’s rubbish, completely rubbish,” Ajay Gupta said, in response to questions about whether his family has influenced ministerial appointments. “These are all rumours and you cannot give a reply to the rumours. You cannot justify it.”

The Guptas trace their roots in South Africa to the early 1990s when Atul Gupta, one of the three brothers, opened a shoe shop in Johannesburg. His brothers, Rajesh and Ajay, arrived in 1997 and established Sahara Computers.

The Gupta empire has since entered into mining, property and the media, which Ajay Gupta puts down to “hardworking people”.

According to the FT, Sahara Holdings and Oakbay Investments generated revenue of R1.35 billion and R3.6 billion respectively in the 12 months to the end of February 2015.

The FT noted that Duduzane Zuma, President Jacob Zuma’s son, has direct or indirect holdings in several Gupta-controlled entities.

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