SWEET HEART DEALS?

Why is Narendra Modi reluctant to appoint a Lokayukta? And why are the corporates singing profuse praises for him?
Hardnews Bureau Delhi

Don't be surprised if India's top corporate honchos sing profuse praises for him and push his name for the country's top job. It does not really matter to them if Indian citizens were butchered in cold blood in the carnage of 2002. This is because Narendra Modi, throughout his tenure as the chief minister of Gujarat, has been able to bring big business on his side by reportedly giving them "out of turn favours and concessions" running into huge sums. This image-building exercise, wherein prosperous Gujarat has been constantly shown as the favoured destination for industry, has cost very dear to the exchequer. No wonder, more and more auto majors and other industries are flocking to Gujarat.

Besides, observers are certain that the entire diatribe by Modi against the appointment of the state Lokayukta, with BJP leaders in Delhi backing him to the hilt, is precisely because there is a lot of hanky panky behind the façade of a 'Vibrant Gujarat' whereby corporate fat cats are showering flowers at him. It is not so simple, say Modi watchers. Modi is jittery on many fronts, from cases of mass murder during 2002, to fake encounters and alleged complicity with Amit Shah, to finally, allegations of corruption and favouritism in terms of lucrative business deals and land acquisition, often favouring top industrialists.

"It's not so rosy," said an Ahmedabad-based journalist. "Why did he refuse to appoint a Lokayukta all these years, while his party, his party president and all BJP leaders are crying hoarse in support of Anna Hazare? While he himself wrote a mushy letter to Hazare? There is more to this savvy hands-on image that Modi has painstakingly created with active help from a seduced corporate class and the media. In a state which was always prosperous, globalised and industrious, even before Modi, this high-pitch rhetoric on one-dimensional development is loaded with hidden meanings."

There are allegations floating all over the place. A memorandum submitted by the Gujarat Congress to President Pratibha Patil alleged that 1,100 acres of land in Sanand was allotted to Tata Motors at a paltry rate of Rs 900 per square metre while the market rate is about Rs 10,000. This win-win deal was initially reported to be mediated by lobbyist Niira Radia, infamous for her wheeling dealings in the 2G scam case. Tatas were offered the deal because they had to shelve the Nano project in Singur, West Bengal, in the wake of mass resistance. Gujarat government not only provided land, but also a loan of Rs 9,570 crore against the total project cost of just Rs 2,200 crore. This seems like a subsidised dream come true for the Tatas.

"...the government has also promised acquisition of land for rail connectivity upto DMIC to Tata Motors and agreed to provide land for ancillary industries and established all infrastructures for electric power, including installation of 220 KV power supply through double circuited feeder... Tata Motors is exempted from payment of electricity duty. Tata Motors has been provided with 1,400 cubic litres water per day at the project site and also permitted to draw ground water for immediate need," the memorandum reads. The complainants argued that the total loss to the exchequer stands at a whopping Rs 33,000 crore.

However, Tatas are not the only beneficiaries. In 2003-04, the influential Adani group was allotted 3,86,83,079 square metres of land for the Mundra port special economic zone, it has been alleged. The allotment was done at an allegedly throwaway price band of Re 1 to Rs 32 per square metre, with most land being allotted for less than Rs 10 per square metre. However, the group, after developing roads, sold off the sub-plots to other firms, including many public sector enterprises, at an astonishing price of Rs 800 to Rs 10,000 per square metre. "The loss to public exchequer... would be Rs 10,000 crore," says the memorandum.

Another instance involves a 108-year-old agricultural institution, Navsari Agricultural University. Its prime land in Surat, which was housing a seed farm, was allotted to Chhatrala India Hotel Group for the development of a seven star hotel. The land was being allotted at a meagre price of Rs 15,000 per square metre against the market price of Rs 1 lakh per square metre. However, after the matter went to the Supreme Court, the government had to increase the rate marginally to Rs 35,000 per square metre. "This was brokered by the chief minister through his office. The government could have earned about Rs 650 crore from the sale of the said piece of the land, (but) the said property has been sold for Rs 224 crore," the memorandum alleges.

The Essar Group companies, many of which, along with Tata Telecommunications and others, are under the scanner in the 2G case, too got a sweet heart deal from Modi. Allegedly, 2,07,60,000 square metres of land that partially falls in the Coastal Regulatory Zone, and includes forest land, was given to them. The Supreme Court has banned any kind of development in these zones. However, the Essar Group has apparently managed to keep itself insulated and continues to enjoy rights on this land.

Former BJP president, Venkaiah Naidu, the memorandum alleges, also enjoyed favours from Modi's government. With several enemies within his own party and the Sangh Parivar, including in Gujarat, Modi allegedly tried to woo Naidu to strengthen his position within BJP. Hence, 24,021 and 26,746 hectares of land in the Kutch coastal region was allotted to Archean Chemicals and Solaris Chem-Tech, said to be "front companies" of Naidu, as per the memorandum.

There are reportedly more cases where policies have been bent or changed to favour a particular industrialist. For instance, there is the case of Bharat Hotels in Ahmedabad, which got 21,300 square metres of land, without any auction, at a low rate of Rs 4,424 per square metre for developing a five star hotel, the Congress memorandum has alleged. Or, Larsen and Toubro Ltd, which received 8,00,000 square metre of land in Hazira, Surat, reportedly, virtually as a "gift" for just Re 1 per square metre. "This cannot be simply done unless the chief minister himself is bribed," said the memorandum. 

This story is from the print issue of Hardnews: OCTOBER 2011

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