This was a peculiar choice. Estina was to buy cows for local farmers and process milk at the farm. But the company was headed by a businessman from India who had a background in information technology — not in farming. Yet, importantly, he had long worked for the Guptas.
Despite the project’s sketchy details, Mr. Zwane signed off on it and asked the provincial treasury to start paying Estina, according to an investigation by the National Treasury. Initially, he was overruled by lawyers in Mr. Magashule’s office, who deemed the contract invalid because procurement rules, like a competitive bid, had not been followed.
But that was only a hiccup. The province signed another contract with Estina the following month — this time with the lawyers’ blessing. That agreement stated that Estina would invest just under $20 million in the project and the province would contribute about $30 million over three years. Local farmers, the so-called beneficiaries, would retain 51 percent of the shares.
There was “something fishy” from the start, said Doctor Radebe, who was a councilor for the opposition Democratic Alliance in Vrede. Mr. Zwane and the agricultural officials presented no business plan or budget for the project, but they and the mayor insisted on pressing ahead, Mr. Radebe said.
The local municipality quickly decided to hand over 3,400 hectares, or about 8,400 acres, of land for the dairy farm.
In fact, the municipality was so determined to get the project underway that it compensated four white commercial farmers, who had been leasing the land for about $80,000 a year, in order to prematurely break their leases. Later that year, just before Mr. Zwane and his local choir left for India, on a trip sponsored by a Gupta company, the province leased the farm to Estina — rent-free, for 99 years.
In an interview, Mayor Motaung said, “We had no doubt that the plan will work.”
But the mayor acknowledged that Mr. Zwane presented no detailed plan or document about the proposed dairy farm. Even basic details — like the criteria for selecting the beneficiaries — were missing, the mayor said, acknowledging that his role in the project was now under scrutiny.