Swaminathan Aiyar says that the prevailing gas price in the US is $3.70, much lower than what the government and Mukesh Ambani mandated price of $4.20 is. Strange? Begs the question - who is profiteering? In June 2008, Swami writes in the Times of India that the price of gas in the US was $13. One also needs to add that $4.20 excludes the transportation cost and other levies. Remember that the gas has to be brought onshore first before pipelines take it wherever...
Another top editor writing on the same page in ToI has torn into Murli Deora, sorry gaswale uncle. Quoting from extracts of the infamous Polyester Prince written by Hamish McDonald, M J Akbar has traced the genesis of Deora's relationship with the Dhirubhai Ambani. But he adds, "The past cannot be held against Deora's present." In an age where the price spiral of essential commodities continues unabated, Akbar makes a telling point, "This must be the first government that is determined on raising the price of a national asset that is in the private possession of Mukesh Ambani, rather than bringing it down, or indeed keeping it at a level that a private company offered and accepted as as part of a contractual agreement."
On Friday rising prices, Sharad Pawar claimed were due to the ever increasing cost of energy. Curious. One central minister wants to raise the price of energy - in this case gas - while another says that the price of energy is responsible for the price spike. Government working at odds, no? And whose interests does this gas price rise serve? Obviously Murli Deora's master Mukesh Ambani's. He pockets the money, not the government. The finance and power ministers are keeping quiet. Finance doesn't want to have anything to do with this unsavoury controversy because he wants to remain neutral while Power (under whom NTPC comes) remains powerless in this dispute. Akbar tells it like it is - Patriotism has clearly become the last refuge of Murli Deora.
Even at today's prevalent gas price of $3.70 in the US, Mukesh Ambani and mind you not the government is making a large profit. Fifty cents is the margin even at today's price of gas. Makes one wonder how the government or was it the oil ministry fixed $4.20 as the price of gas. Conventional economic logic be damned. People must pay more for their own national asset because Mukesh Ambani has to profit.
Sunday, August 9, 2009
Friday, August 7, 2009
sadness vs pain
Reliance Industries chairman Mukesh Ambani is suddenly feeling sad over his younger brother's acerbic pinpoint pincer attacks. Finally the deafening silence has been met with pangs of sadness over the nature of personal attacks launched by Anil Ambani. Rather late in the day to develop bouts of emotion, wouldn't you think? While reacting, he has chosen not to deal with substantive issues raised by the ongoing gas opera. All this while Mukesh Ambani has chosen to hide behind oil minister Murli Deora and hydrocarbons boss VK Sibal. He has let them do the talking. The matter is sub judice, he argues. He is keeping quiet out of respect for the Supreme Court which is adjudicating on the matter. But that doesn't prevent Deora, Sibal and company from launching virulent tirades against NTPC and RNRL. Meanwhile at a function in Mumbai he collected the other half of his family in a show of strength, but failed to respond to the material charges levelled against him and his company.
Subir Raha who knows a thing or two about NELP and production sharing contracts having been chairman of ONGC for many years has lashed out at the oil ministry in a devastating critique in the Economic Times. Raha writes, "The present petroleum minister has held the job for three and a half years; he had the cramp on 'sovereign right on mineral resources' only after the Bombay H.C decided on the RIL-RNRL case. Evidently he is oblivious of the fact that the prime purpose of his ministership is to protect and exercise those rights! Going by media reports, the ministry's and the ministry's case is that to make any offer of sale, the 'contractor' is required under the production sharing contract (PSC) to obtain prior approval of quantity and price from the ministry of petroelum and natural gas. Did the ministry 'approve' RIL's bid before it was submitted to NTPC? The point of dispute in the RIL-NTPC case is whether the global tender was concluded in a contract? Going by the stand now taken by the petroleum minister, RIL's bid was illegal because by all accounts, prior 'approval' of the petroleum ministry was not taken. The illegal tender should have been rejected outright; on the other hand, NELP terms and conditions were publicised in full by GoI MoPNG, and NTPC should have made such prior 'approval' for domestic NELP gas a pre-qualification criterion. Either way, NTPC is at fault. Absurd."
Well said Major Raha. He then goes on to blow away Deora's contention by saying, "NELP and award of each PSC under NELP is approved by the Cabinet; individual ministers cannot make any change in a signed PSC. Even when a minister and a contractor agree on modifications, the Cabinet has to accord formal approval...There is deafening silence from one set of interested parties: the power minister, his ministry and his company?" Amazing isn't it that a former chairman of navratna PSU ONGC has had to take up cudgels on behalf of another navratna PSU - NTPC? Nobody cares about NTPC, a public listed company with the government and foreign and domestic investors as its shareholders. Even as the brothers slug it out, NTPC writhes in pain and the government and parliament is seemingly paralysed by gas. It is another matter that sugar, pulses and vegetable prices are running amok.
Subir Raha who knows a thing or two about NELP and production sharing contracts having been chairman of ONGC for many years has lashed out at the oil ministry in a devastating critique in the Economic Times. Raha writes, "The present petroleum minister has held the job for three and a half years; he had the cramp on 'sovereign right on mineral resources' only after the Bombay H.C decided on the RIL-RNRL case. Evidently he is oblivious of the fact that the prime purpose of his ministership is to protect and exercise those rights! Going by media reports, the ministry's and the ministry's case is that to make any offer of sale, the 'contractor' is required under the production sharing contract (PSC) to obtain prior approval of quantity and price from the ministry of petroelum and natural gas. Did the ministry 'approve' RIL's bid before it was submitted to NTPC? The point of dispute in the RIL-NTPC case is whether the global tender was concluded in a contract? Going by the stand now taken by the petroleum minister, RIL's bid was illegal because by all accounts, prior 'approval' of the petroleum ministry was not taken. The illegal tender should have been rejected outright; on the other hand, NELP terms and conditions were publicised in full by GoI MoPNG, and NTPC should have made such prior 'approval' for domestic NELP gas a pre-qualification criterion. Either way, NTPC is at fault. Absurd."
Well said Major Raha. He then goes on to blow away Deora's contention by saying, "NELP and award of each PSC under NELP is approved by the Cabinet; individual ministers cannot make any change in a signed PSC. Even when a minister and a contractor agree on modifications, the Cabinet has to accord formal approval...There is deafening silence from one set of interested parties: the power minister, his ministry and his company?" Amazing isn't it that a former chairman of navratna PSU ONGC has had to take up cudgels on behalf of another navratna PSU - NTPC? Nobody cares about NTPC, a public listed company with the government and foreign and domestic investors as its shareholders. Even as the brothers slug it out, NTPC writhes in pain and the government and parliament is seemingly paralysed by gas. It is another matter that sugar, pulses and vegetable prices are running amok.
Thursday, August 6, 2009
ek aur gaswala
The debut in parliament of another gaswala, this time not an uncle, but a Reliance Industries minion Parimal Nathwani is exteremly important in the context of the ongoing gas opera for it tells us how the sanctity of prliament is being misused and abused to further naked corporate interests. RIL's Gujarat strongman and Narender Modi groupie Nathwani an 'independent' MP in the upper house declared his affiliation for RIL openly.
By openly and aggressively saying that he represents the corporate interests of RIL, he has thrown up questions over the very existence of such individuals in the two houses. CPM MP Brinda Karat saddened with the way things are working out has even compalined to the Rajya Sabha chairperson vice president Hamid Ansari on this nexus and how it impacts the dignity of the house. She has spoken about the conflict of interest extending now to the conflict of dignity of the house. And rightly so. Nathwani's open advocacy makes one wonder where Indian democracy is headed?
By openly and aggressively saying that he represents the corporate interests of RIL, he has thrown up questions over the very existence of such individuals in the two houses. CPM MP Brinda Karat saddened with the way things are working out has even compalined to the Rajya Sabha chairperson vice president Hamid Ansari on this nexus and how it impacts the dignity of the house. She has spoken about the conflict of interest extending now to the conflict of dignity of the house. And rightly so. Nathwani's open advocacy makes one wonder where Indian democracy is headed?
ntpc left holding baby and bathwater
Gaswale uncle is going great guns in parliament and he cares two hoots for what the rest of the world thinks. Isn't it amazing a section of the government (oil ministry) is out to undermine and even jeopardise the interests of another (power ministry). In a brazen and blatant manner and the powers that be are not able to do a damn thing. Let us for a moment forget about the Ambani gas opera. Throw it into the nearest the waste paper basket. Let us concentrate on the interests of NTPC, a government owned navratna. Nobody seems to care about the poor PSU's interests in this gas opera. They are the first and rightful claimant of the gas as per an international tender that they put out which was secured by RIL at $2.34. The government seems to be powerless. Yes powerless for poor NTPC is part of the power ministry which has no voice whatsoever in the Union cabinet.
With gaswale uncle now officially refuting NTPC's right to 12 million units per day for 17 years on the floor of the house, it is curtains for NTPC. To use gaswale uncle's exact words - RIL's $2.34 gas price for NTPC is not valid, selling price will be $4.20. So, the RIL spokesperson in the government Murli Deora couldn't care less as he toes the RIL line in parliament. Saying that it is an unconcluded contract, Deora doesn't want to be reminded that RIL sent its letter cancelling the contract on June 17, 2005, a day prior to the Kokilaben Ambani family settlement announcement. That the price is $4.20 is not lost on anyone. 420 is a number that all Indians are familiar with. It is a synonym for duplicity and fraud.
Even more significantly, Deora ruled out nationalising of the KG Basin fields to virtually ensure that Mukesh Ambani's unfettered claims on the 'national resource' remain intact. All this even as MPs across party lines attacked him. But he didn't bat an eyelid. Does this performance in parliament dash the hopes of NTPC once and for all? Or will the Supreme Court prove to be the final arbiter, like it always does? Fundamentally, technically and legally many legal ceagles reckon that the Supreme Court cannot find fault with the Bombay High Court judgment in favour of RNRL. This will be bedrock on which the SC will give its final say. But that certainly leaves powerless NTPC holding the baby and the bathwater.
Deora said, "We have nothing to do with the private dispute of the two industrialists. However, we have everything to do with protecting the interests of the government and public. It is our constitutional and legal obligation to protect the people of India and we will, honestly honour it. We will make all endeavours to protect the government's legal rights to regulate the utilisation of gas and its allocation."
Excuse me, let us the people of India remind Mr Minister that NTPC is a government owned company which is publicly listed and has lakhs of shareholders - government, foreigners and Indian public and to any right minded person epitomises everything that Deora is defending so stoutly in parliament. Only for him 'protecting interests' of Reliance Industriues gains paramountcy over everything else. Meanwhile, NTPC and the power ministry appear helpless in the face of such brazen speak.
With gaswale uncle now officially refuting NTPC's right to 12 million units per day for 17 years on the floor of the house, it is curtains for NTPC. To use gaswale uncle's exact words - RIL's $2.34 gas price for NTPC is not valid, selling price will be $4.20. So, the RIL spokesperson in the government Murli Deora couldn't care less as he toes the RIL line in parliament. Saying that it is an unconcluded contract, Deora doesn't want to be reminded that RIL sent its letter cancelling the contract on June 17, 2005, a day prior to the Kokilaben Ambani family settlement announcement. That the price is $4.20 is not lost on anyone. 420 is a number that all Indians are familiar with. It is a synonym for duplicity and fraud.
Even more significantly, Deora ruled out nationalising of the KG Basin fields to virtually ensure that Mukesh Ambani's unfettered claims on the 'national resource' remain intact. All this even as MPs across party lines attacked him. But he didn't bat an eyelid. Does this performance in parliament dash the hopes of NTPC once and for all? Or will the Supreme Court prove to be the final arbiter, like it always does? Fundamentally, technically and legally many legal ceagles reckon that the Supreme Court cannot find fault with the Bombay High Court judgment in favour of RNRL. This will be bedrock on which the SC will give its final say. But that certainly leaves powerless NTPC holding the baby and the bathwater.
Deora said, "We have nothing to do with the private dispute of the two industrialists. However, we have everything to do with protecting the interests of the government and public. It is our constitutional and legal obligation to protect the people of India and we will, honestly honour it. We will make all endeavours to protect the government's legal rights to regulate the utilisation of gas and its allocation."
Excuse me, let us the people of India remind Mr Minister that NTPC is a government owned company which is publicly listed and has lakhs of shareholders - government, foreigners and Indian public and to any right minded person epitomises everything that Deora is defending so stoutly in parliament. Only for him 'protecting interests' of Reliance Industriues gains paramountcy over everything else. Meanwhile, NTPC and the power ministry appear helpless in the face of such brazen speak.
Wednesday, August 5, 2009
minister has to go
Business Standard in a scathing indictment in its editorial has asked for oil minister Murli Deora's head. It is much like Alice in Wonderland with a clarion call of 'Off with his head' going out loud and clear. When a respected newspaper like BS in its editorial asks for a change, then the widespread indignation that the oil minister's role in the gas row has created is a lesson in itself for the political class.
Titled - 'Move Mr Deora' - the editorial fulminates on the Murli Deora's partisan role in the matter. Saying that the oil minister has offered no clarity whatsoever in his defence in the floor of the house on Monday, BS says that it is well known that Deora is a close friend of Mukesh Ambani, the RIL chairman and as such his role is suspect because there is a conflict of interest. BS writes, "Changing Mr Deora's portfolio is a first step... The Government cannot afford to have its name dragged into a battle between two corporate giants." Saying that the blandness of Deora's responses have bene noteworthy with Deora repeating the old line that public interest being superior to the deal between the two brothers.
In any case, it appears that Deora's fabulous run in Shastri Bhawan might be over for he is becoming increasingly forgetful these days. Mail Today in its whispers column - Raisina Tattle - on Wednesday writes that Deora now forgets where his car is parked to which way his office is located in parliament. A man once known as Kaka to the two Ambani brothers has a new epithet in Delhi. He is now called gaswale Kaka. Reportedly he is the butt of jokes even amongst his colleagues who refer to him by his new moniker gaswale uncle. His barefaced support for Mukesh Ambani has left many in government deeply embarrassed. BS has argued for his departure very coherently and cogently.
Titled - 'Move Mr Deora' - the editorial fulminates on the Murli Deora's partisan role in the matter. Saying that the oil minister has offered no clarity whatsoever in his defence in the floor of the house on Monday, BS says that it is well known that Deora is a close friend of Mukesh Ambani, the RIL chairman and as such his role is suspect because there is a conflict of interest. BS writes, "Changing Mr Deora's portfolio is a first step... The Government cannot afford to have its name dragged into a battle between two corporate giants." Saying that the blandness of Deora's responses have bene noteworthy with Deora repeating the old line that public interest being superior to the deal between the two brothers.
In any case, it appears that Deora's fabulous run in Shastri Bhawan might be over for he is becoming increasingly forgetful these days. Mail Today in its whispers column - Raisina Tattle - on Wednesday writes that Deora now forgets where his car is parked to which way his office is located in parliament. A man once known as Kaka to the two Ambani brothers has a new epithet in Delhi. He is now called gaswale Kaka. Reportedly he is the butt of jokes even amongst his colleagues who refer to him by his new moniker gaswale uncle. His barefaced support for Mukesh Ambani has left many in government deeply embarrassed. BS has argued for his departure very coherently and cogently.
Tuesday, August 4, 2009
kissa gas ka
Ye na mera hai, na tera, yeh gas toh sarkar hai, so says oil minister Murli Deora. Samajwadi Party leader Mulayam Singh tears into him on the floor of the house, stopping short at calling him a thief. Soon after, Anil Ambani launches into Deora saying that the oil minister has adopted a partisan approach on the issue from day one to protect the interests of elder brother Mukesh Ambani. By evening, government counsel in the Supreme Court on the gas row Mohan Parasaran says that government has a case vis a vis sovereign ownership and will intervene suitably in the matter.
Excuse me, isn't this matter sub judice? Isn't this matter being heard in the SC? What is the matter with everybody? Look around you, propriety has been given a decent burial. Former home secretary Anil Baijal is the spokesperson for the private airline operators and he calls for a strike on behalf of them. So, he is opposing the government, isn't he? Former TRAI chairman and disinvestment secretary Pradeep Baijal is operating on behalf of Mukesh Ambani and Ratan Tata owned PR company, serving their corporate interests by walking the corridors of power and lobbying on their behalf.
Now oil minister is brazenly and blatantly talking the talk and walking the walk for Mukesh Ambani in parliament. What is happening to this country? What has happened to high moral ground, public propriety and other such monikers? I guess it is a sign of the times that sitting politicos and former bureaucrats have decided to cast the cloak of propriety aside and support their respective business interests. But does this reflect well on the government its Prime Minister who is known for his standards of ethicality and integrity? Sad to see public life degenerating into this kind of a joke. And all for 20 pieces of silver. Think of the apex court's position in the gas row. It is unable to enforce a code of conduct among the various players including the minister and the government counsel. What happened to sub judice? Earlier people would think twice before taking and view publicly on the matter.
Excuse me, isn't this matter sub judice? Isn't this matter being heard in the SC? What is the matter with everybody? Look around you, propriety has been given a decent burial. Former home secretary Anil Baijal is the spokesperson for the private airline operators and he calls for a strike on behalf of them. So, he is opposing the government, isn't he? Former TRAI chairman and disinvestment secretary Pradeep Baijal is operating on behalf of Mukesh Ambani and Ratan Tata owned PR company, serving their corporate interests by walking the corridors of power and lobbying on their behalf.
Now oil minister is brazenly and blatantly talking the talk and walking the walk for Mukesh Ambani in parliament. What is happening to this country? What has happened to high moral ground, public propriety and other such monikers? I guess it is a sign of the times that sitting politicos and former bureaucrats have decided to cast the cloak of propriety aside and support their respective business interests. But does this reflect well on the government its Prime Minister who is known for his standards of ethicality and integrity? Sad to see public life degenerating into this kind of a joke. And all for 20 pieces of silver. Think of the apex court's position in the gas row. It is unable to enforce a code of conduct among the various players including the minister and the government counsel. What happened to sub judice? Earlier people would think twice before taking and view publicly on the matter.
Sunday, August 2, 2009
offensive tactics
On the eve of the oil minister Murli Deora's defence of his indefensible ministry's position on the Ambani gas row, Anil Ambani unleashed yet another broadside on Sunday. Rising to the defence of the hapless PSU power major NTPC, Ambani Junior said, "NTPC is an innocent victim of Mukesh Ambani's RIL's corporate greed and if the gas is not sold at the 'agreed' price of $2.34, it would result in a loss of Rs 30,000 crore to the company."
In a letter to power minister Sushil Kumar Shinde released to the media on Sunday, Ambani clarified that RNRL was not at all keen to scupper NTPC's interests of garnering 12 million units of gas from RIL for a duration of 17 years. The unfortunate reality is that RIL pulled out of its global tender to provide gas to NTPC's Kawas and Gandhar plants on June 17, 2005, a day prior to the family settlement between the two Ambani brothers which divided the Reliance Industries empire through a transparent process of corporate restructring and a scheme of demerger.
RIL pulled out of its contract saying that it was 'unconcluded' knowing fully well what the contents of the family MoU were. Given that the RIL-NTPC gas deal for 12 million units for 17 years formed the pricing basis of the 28 million units for a similar 17 years to RNRL. By reneging on the NTPC deal priced and discovered through an internationally competitive bid, RIL was paving the path for playing truant with both RNRL and NTPC in the future. It was part of a larger more deliberate plan to retain control over the gas. Both NTPC and RNRL subsequently took RIL to court and RNRL received justice on June 15 this year. Since then RIL has filed a Special Leave Petition in the SC challenging the verdict. The SC will hear the case from September 1.
It is clear as daylight that pandemonium will prevail in parliament when Murli Deora tries to defend his ministry on Monday. Interestingly, no section of the gevernment other than the oil ministry has challenged the Bombay High Court June 15 verdict.
This makes for a very curious state of play. Will the government disown Murli Deora after his utterances on Monday? Will India have a new oil minister as soon as parliament is adjourned? Will a top politician close to the powers that be make a comeback to the Cabinet as the new oil minister? We are in for interesting times.
In a letter to power minister Sushil Kumar Shinde released to the media on Sunday, Ambani clarified that RNRL was not at all keen to scupper NTPC's interests of garnering 12 million units of gas from RIL for a duration of 17 years. The unfortunate reality is that RIL pulled out of its global tender to provide gas to NTPC's Kawas and Gandhar plants on June 17, 2005, a day prior to the family settlement between the two Ambani brothers which divided the Reliance Industries empire through a transparent process of corporate restructring and a scheme of demerger.
RIL pulled out of its contract saying that it was 'unconcluded' knowing fully well what the contents of the family MoU were. Given that the RIL-NTPC gas deal for 12 million units for 17 years formed the pricing basis of the 28 million units for a similar 17 years to RNRL. By reneging on the NTPC deal priced and discovered through an internationally competitive bid, RIL was paving the path for playing truant with both RNRL and NTPC in the future. It was part of a larger more deliberate plan to retain control over the gas. Both NTPC and RNRL subsequently took RIL to court and RNRL received justice on June 15 this year. Since then RIL has filed a Special Leave Petition in the SC challenging the verdict. The SC will hear the case from September 1.
It is clear as daylight that pandemonium will prevail in parliament when Murli Deora tries to defend his ministry on Monday. Interestingly, no section of the gevernment other than the oil ministry has challenged the Bombay High Court June 15 verdict.
This makes for a very curious state of play. Will the government disown Murli Deora after his utterances on Monday? Will India have a new oil minister as soon as parliament is adjourned? Will a top politician close to the powers that be make a comeback to the Cabinet as the new oil minister? We are in for interesting times.
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