People's Democracy

CAIRN-VEDANTA DEAL

CPI(M) MP Urges Rethink

On July 1, CPI(M) MP and CITU general secretary Tapan Sen sent the following letter to Dr Manmohan Singh, the prime minister, regarding the Cairn-Vedanta deal.

KINDLY refer to my letters dated 14.2.2011, 18.2.2011, 9.3.2011, 6.5.2011, 3.6.2011 and 14.6.2011 on the subject.  You had kindly acknowledged receipt of these letters. The issue was also raised in Rajya Sabha on 19.8.2010 and 9.3.2011. The government’s intervention was sought for assertion of the ONGC’s pre-emption right for controlling stake in the Cairn India as M/s Vedanta is having no experience in oil exploration and production as well as it has a dubious reputation as evident from the government’s prevention order on its bauxite mining in Orissa. There are further disquieting reports that its subsidiary, the Sesa Goa, which is also involved in the deal, is facing investigation by the Serious Fraud Investigation Office (SFIO) for siphoning money and transferring to various group companies.

It is learnt from today’s press reports that the cabinet has cleared the Rs 39,000 crore Cairn-Vedanta deal. I seriously urge upon you that the decision be reviewed in view of its serious multi-prong implications. I reiterate that the CAG should be consulted and issue be discussed in parliament before any decision is taken on this deal. In this connection, I invite your kind attention to the following observation by the Hon’ble Supreme Court on the KG basin gas dispute.

“It is relevant to note that the constitution envisages exploration, extraction and supply of gas to be within the domain of governmental functions.  It is the duty of the Union to make sure that these resources are used for the benefit of the citizens of this country. Due to shortage of funds and technical know-how, the government has privatized such activities through the mechanism provided under the PSC. It would have been ideal for the PSUs to handle such projects exclusively.”

Obviously the above holds good for oil fields under M/s Cairn India. The ONGC does not have shortage of fund or technical knowhow vis-a-vis Vedanta. Here is an ideal case for the ONGC, a Maharatna PSU, to handle the biggest oil discovery in Rajasthan in national interest. I am sure my persistent pursuance of the issue will not be treated as “post facto analysis” but an effort in the public interest to appraise you of “more and more facts” so that no wrong decision is taken on the plea of foreign investment.