Vol 3, PW 16 (01 Sep 99) People & Policy

Government sources in Delhi tell Petrowatch of secret talks underway between Dhirubhai Ambani, boss of Reliance Industries, and Nawaz Sharif, Prime Minister of Pakistan.

The negotiations centre on a "no-war" pact to secure the safety of Reliances Jamnagar petrochemical complex - located in the western state of Gujarat - about 150 miles east from the border with Pakistan. This report learns negotiations are being conducted via two Indian gangsters with links to both sides: Dawood Ibrahim and Babloo Srivastava.

Ibrahim is presently in Pakistan, on the run from Indian authorities for plotting the serial bomb blasts in Bombay on 12th March 1993 which left 317 people dead. Srivastava, a Dawood affiliate, is in New Delhi's Tihar jail, where he freely operates with a mobile phone.

The proposed deal suggests Reliance is offering Pakistans civilian and military establishment a total of Rs15bn ($348m) to ensure it does not attack the companys oil, gas and petrochemicals installations. If Pakistan accepts, it is believed Rs2bn ($46.5m) has been set aside for Sharif, with the rest going to key Pakistani lawmakers, military and civilian officials.

During the Kargil conflict in July, Reliance tried but failed to obtain war insurance from Indian (state-run) insurance companies. Then, on 10th August, an Indian MiG 21 shot down a Pakistani Atlantique reconnaissance and strike aircraft over Kori Creek, just 127 miles from Jamnagar, killing all 16 on board.

A source tells Petrowatch this incident sent alarm bells ringing at Reliance HQ in Mumbai. "They got very nervous when that happened", Petrowatch is told.

First contact between Reliance and Pakistan was established began in January 1997, when India shot down a Pakistani spy plane over Bhuj - 60 miles west of Jamnagar. The latest incident has convinced the company a "pay-off" to Pakistan is now the only "insurance cover" available.