CAG report points to mother of all scams

Published: 19th August 2012 10:10 AM  |   Last Updated: 19th August 2012 10:10 AM   |  A+A-

public exchequer, said the CAG report on coal, airport modernisation and power projects tabled in Parliament on Friday.

The losses, taking the UPA-scam figures to a new high, are from three sources: from under-pricing of 57 coal blocks given to private firms, including Jindals, Tatas, Rungtas, Birlas; from the undue favours bestowed on GMR-led DIAL for development of Delhi airport and on the Reliance Power Ltd for the Sasan Ultra Mega Power Project.

Take the coal sector, a slew of private firms  were given captive coal fields between 2005 and 2009, with extractable reserves worth 1,010.575 million tonne, under Prime Minister Manmohan Singh’s guidance (who held Coal Ministry then). Financial gains to the private beneficiaries of the coal blocks add up to `1.86 lakh crore.

The CAG report stated that allotment was based without any bidding. “The Screening Committee recommended the allocation of coal block to a particular allottee/alottees out of all the applicants. However, there was nothing on record in the minutes or in other documents indicating any comparative evaluation of the applicants for a coal block. Thus, a transparent method for allocation of coal blocks was not followed by the Screening Committee.”

Seventeen of the 57 captive coal mines allotted to private players were in Jharkhand, the rest in Odisha, Chhattisgarh, Maharashtra, Madhya Pradesh and West Bengal.

Often the big-players in the Steel and the Power sectors, got into joint ventures with smaller local companies to avail more than one coal block, the Jindal, Tatas and Rungta followed this route. So did the Bhushans, the second biggest beneficiary.

One of the biggest coal blocks in Odisha - 1,095 mt - was allotted to a little-known private firm called Strategic Energy Tech System Ltd.


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