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CAG indicts Narendra Modi government for favouring big corporate houses

The Comptroller and Auditor general of India has indicts Gurajat government-owned Gujarat State Petroleum Corporation (GSPC) for favouring big corporate houses like Reliance Industries Limited and the Adanis.

D.P. Bhattacharya | March 30, 2012 | Updated 09:58 IST

The Comptroller and Auditor general of India (CAG) has indicted Gurajat government-owned Gujarat State Petroleum Corporation (GSPC) for favouring big corporate houses like Reliance Industries Limited (RIL) and the Adanis.

GSPC has come under fire from CAG for buying gas from the open market and "selling" it to the Adanis at a price lower than its own cost price. CAG estimated that Adani Energy received undue benefit of Rs 70.54 crore in the process.

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CAG has also noted that RIL has unilaterally installed control and riser platform in a part of Krishna Godavari (KG) Block licensed to GSPC without its consent. CAG observed that this would make GSPC responsible for safety and security of RIL's structure for its life period. GSPC has also come under fire for submitting bid for acquiring KG Block without properly estimating the financial and technical issues related to it. CAG observed that the result of the lacuna manifested in majorly escalated drilling cost as well as depth, which went up from estimated 45,348 metres to 77,395.07 meters. The cost, which was estimated at $102.23 million rose to $41302.88 million.

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CAG also slammed GSPC for the time taken for carrying out the environmental impact assessment studies in eight domestic blocks. The most high-profile public sector unit (PSU) in Gujarat, GSPC has estimated to have run into losses of Rs 5,000 crore largely due to its faulty operations in the KG Basin for oil exploration.

Not only GSPC, other PSUs also came in the red as Gujarat Road Transport Corporation reportedly listed loss of Rs 159.74 crore and Gujarat State Financial Corporation suffered a loss of Rs 156.91 crore.

The Assembly has been witnessing heightened drama over tabling of the CAG report as the state government has scheduled it for the last day of the ongoing Budget Session on Friday.

The opposition has already submitted a memorandum to governor Kamla Beniwal, who has sought an explanation from the state government concerning the delay in tabling the CAG report. Meanwhile, on Wednesday, the entire Opposition was suspended after it caused a ruckus over the tabling of the report. "Four of our MLAs were not present in the house on Wednesday and these four will be there when the report is tabled on Friday," said Siddharth Patel from Congress.

The report, which has found its way into the media, has punctured the tall claims of the state government of turning sick PSUs into profitable ones.

Gujarat Pradesh Congress Committee president Arjun Modvadia came down heavily on the state government saying that the report exposes the corruption in the Bharatiya Janata Party government in Gujarat. "The report clearly shows how the state government is favouring only a handful of industrialists instead of working for the six crore Gujaratis," Modvadia said adding that the state government is now avoiding uncomfortable questions on the report by tabling it on the last day of the Session.

Meanwhile, the state government chose to underplay the controversy. Government spokesperson Jay Narayan Vyas told MAIL TODAY that even if the CAG report was tabled on the first day of the Session, it would not have made much of a difference.

"The CAG report goes to the Public Accounts Committee (PAC), which is headed by a member from the Opposition," Vyas said adding that the PAC then studies the report and grills relevant departments before preparing its own report, which is submitted to the Speaker," Vyas explained rubbishing the allegations of delaying the tabling of the report.

Courtesy: Mail Today 

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