Political double standards over Enron PPA

Vol 4, PW 23 (20 Dec 00) Midstream & Downstream

Cynics in Mumbai are having a hard time understanding why the Maharashtra unit of the Congress party so vociferously opposes the Power Purchase Agreement (PPA) signed with the Dabhol Power Company.

On 8th December 1993, former Congress chief minister Sharad Pawar signed the original Dabhol PPA, and rumour has it he gained handsomely by so doing, courtesy Enron. Today, Pawar is part of the government that opposes the PPA.

It's no different with the Hindu fundamentalist Shiv Sena. In 1993, Shiv Sena was among the most vociferous critics, but its anger evaporated when it took power and "renegotiated" with Enron.

Again, Shiv Sena supremo Bal Thackerey is said to have gained handsomely from the party's "change of heart." When first signed, objections centred on the PPA's "opaque" nature and lack of approval from the Central Electricity Authority. Still unexplained is $20m Enron said it spent "educating" Indians about the project.

Many suspectCongress chief minister Vilasrao Deshmukh of using the project to upstage his rival Pawar and his breakaway Nationalist Congress Party. Both draw support from the same voter constituency.

Another less flattering theory is that when he oversaw the original deal back in 1993, Pawar did not "share the booty" with the party apparatus in Delhi. "No money went to the Congress high command," reveals a source, "That's why Sonia Gandhi also wants the project scrapped."