The often crowded bar at the fashionable Gymkhana Club in central New Delhi, a holdover from the days of British rule where white-gloved waiters serve gin and tonics on the veranda under whirling ceiling fans, reportedly was the venue for one of the biggest espionage rings to be uncovered since India gained independence 37 years ago.
There, according to Indian intelligence sources and western diplomats, Indian businessmen rubbed shoulders with social climbers in the bureaucracies of nearby government ministries, buying them drinks and introducing them to friends from the tree-lined diplomatic and foreign business enclave of Chanakyapuri.
Among the guests were said to be well-dressed foreign businessmen, embassy attaches in expensive suits and low-level male secretaries wearing coarse cotton pajama suits.
Members of the alleged spy ring reportedly wined and dined the $90-a-month government clerks and personal assistants, paying with bundles of rupees for photocopies of military procurement orders, minutes of ministerial meetings, defense analyses, technology transfer agreements, weapons manuals and other secret documents that routinely flow through the labyrinth of the Indian bureaucracy.
One businessman is said to have entertained middle-level government officials in a spacious bungalow in south New Delhi's Hailey Road, hosting parties at which attractive young women mingled with bureaucrats and bottles of imported scotch and cassette recorders were handed out to guests.
Since reports of the alleged spy ring surfaced last week, sending reverberations through the newly installed government of Prime Minister Rajiv Gandhi, 11 government employes and three Indian businessmen have been arrested and at least a dozen more officials have been summoned for interrogation.
Most of these arrested have been personal secretaries, office assistants, stenographers and what are called "peons," office boys who perform routine office chores and run errands. Already touched by the scandal have been six employes in the prime minister's secretariat, two from President Zail Singh's office, two from the Defense Ministry's production department and two from the Ministry of Commerce.
In what the Indian press has labeled the "French Connection," at least one diplomat from the French Embassy, deputy military attache Lt. Col. Alain Bolley, left India, reportedly at the request of the Indian Foreign Ministry. Bolley later told The Associated Press in Paris, "I'm not involved in any spying activity."
Two French businessmen were reported to have flown to Paris when Indian intelligence agents began rounding up suspects in the spy ring.
Charged with sedition and criminal conspiracy under India's Official Secrets Act in connection with the alleged spy ring was businessman Kuman Narayan. The report with details of the charges was sealed, but the magistrate before whom he was arraigned said Saturday that Narayan, who has been released on bail, was accused of passing defense secrets and other classified information relating to national security to foreign contacts.
Indian Intelligence Bureau officials reportedly have been sent to several foreign capitals, including Paris and London, to check into possible links between the alleged espionage ring and multinational corporations that regularly trade with India.
The Indian government has shrouded the investigation in secrecy, holding all arraignments of suspects behind closed doors and sealing documentary evidence. The French Embassy has refused to comment on any aspect of the case.
What has emerged from credible Indian sources and western diplomats is a pattern of commercial espionage that appears to have begun with the sale of documents useful in securing government purchasing contracts, and gradually expanded into the wholesale copying and selling of classified records that could have been useful to intelligence agencies of a number of foreign governments. As yet, no foreign government has been publicly linked by the Indian government with the alleged espionage ring.
The flourishing trade in purloined documents also happened to coincide with India's program of modernizing its armed forces and diversifying its purchases of weapons beyond the Soviet Union to include France, Britain and the United States.
The Soviet Union remains India's main weapons supplier, but there recently has been growing competition from western manufacturers for the sale of such items as France's Jaguar jet fighter and Britain's Harrier jump jet.
Indian intelligence officials today were reported to be examining the records of all government tenders for defense contracts issued during the period the alleged espionage network was believed to have operated.
While Indian government officials repeatedly have said that the breakthrough in uncovering the alleged espionage ring came during a general review of security operations following the Oct. 31 assassination of prime minister Indira Gandhi, a different version has been circulating in the Indian press and among western diplomats here.
According to that version, counterespionage agents began looking into possible security lapses in the prime minister's office and the Defense Ministry after U.S. newspapers, including The Washington Post, reported in early October that India had contingency plans for a preemptive strike against the Pakistani nuclear installation at Kahuta.
A copy of the purported contingency plan, which was leaked in Washington after being outlined to a congressional committee by U.S. intelligence officials, was said to have been stolen from the prime minister's office in September. When it surfaced in Washington, according to the version circulating here, Indian intelligence officials were alerted to security lapses in the prime minister's office and uncovered the spy ring.
So far, no senior Indian government official has been implicated in the scandal, although one of Gandhi's most senior aides, principal secretary P.C. Alexander, resigned in a face-saving gesture because of embarrassment over security lapses in his office. Government sources said Alexander is likely to be recalled to another senior post when the controversy subsides.
Official sources said they doubted that the alleged spy network reached above the middle-management level of government ministries, although they said they expected more arrests.
Some Indian officials maintained that the disclosure of a pervasive breakdown of procedures for handling secret documents and a laxity in even the most sensitive offices of the government has been more important than any compromising of national security by the leaks.
In India's huge bureaucracy, low-level civil servants routinely come into contact with top secret documents.