Mulayam backs oil PSUs in Haldia funding row

Vol 6, PW 7 (05 Jun 02) People & Policy

ONE OF INDIAS most prominent opposition politicians has sharply criticised moves to force ONGC, IOC and GAIL into financially bailing out the struggling private sector Haldia Petrochemicals project in West Bengal.

Mulayam Singh Yadav, awrestler turned politician and former defence minister of India, has written an angry letter to prime minister Atal Behari Vajpayee, complaining bitterly about press reports suggesting ONGC, IOC and GAIL are preparing to help resurrect Haldia Petrochemicals with an infusion of cash. Singh is leader of the small but powerful Samajwadi (Socialist) Party and chairman ofparliament's Standing Committee on Petroleum & Chemicals.

In his 7th May letter to the PM, Yadav is angry that state-run companies are being asked to help Haldia Petrochemicals when this should be the responsibility of project promoters Tata Group, Purnendu Chatterji Group, and the West Bengal Industries Development Corporation. He demands that Vajpayee "ensure that PSUs are not used in any manner directly or indirectly either to bail out or to support loss making failed (private) enterprises".

According to Yadav, moves to force ONGC, IOC and GAIL to help Haldia with money amount to nothing less than an "indirect method of nationalising sick private enterprises". He argues that the Chatterjee Group in particular would benefit most after selling its stake "at more than 100% premium to the restated book value." Writes Yadav: "If Mr Chatterji is successful it would be the biggest political scam."