CAG slams UPA Govt on coal, power, airport; Opposition asks PM to quit

Mangalore Today News Network

New Delhi,Aug 17,2012:The spectre of corruption has come back to haunt the Congress-led United Progressive Alliance Government once again with the Comptroller and Auditor General coming down heavily on the Centre for its "flawed" policy on coal blocks allocation, Delhi international airport and power projects.

As soon as the three CAG reports were tabled in Parliament on Friday, the Opposition took up the issue vociferously to corner the UPA Government with the Bharatiya Janata Party (BJP) leading the charge.

Accusing the UPA of indulging in humungous corruption, the Opposition said that Prime Minister Manmohan Singh was directly responsible for the alleged loss due to the coal block allocation which according to the CAG causes a loss of about Rs 1.86 lakh crore to the state exchequer.

 

Demanding that the Prime Minister must introspect and quit immediately, the BJP said that the country was doomed if the UPA continued to remain in power.

While the CAG report of coal blocks allocation gave the Opposition the most potent ammunition to target the UPA Government, the reports on power projects and Delhi international airport were no less damming.

CAG report on coal: ’Scam bigger than 2G’

The CAG report on coal finds the scam bigger than the 2G scam. According to the report, the coal blocks allocations caused the exchequer a loss of Rs 1.86 lakh crore, much bigger than what the 2G scam cost.

The report said that the estimate was only on account of private players and that the loss caused by PSUs would be audited separately.

Nearly 44 billion tonnes of coal were given at throwaway prices. Around 194 coal blocks were allotted on mere recommendation, the report adds.

The allotments were made when Prime Minister Manmohan Singh was the coal minister. The PM reportedly ignored the then coal secretary’s advice to auction coal blocks.

Rapping the government for its failure to timely implement the competitive bidding mechanism for allocation of coal blocks, CAG today said part of the Rs 1.86 lakh crore loss could have been partially tapped had the procedure been put in place earlier.

In its report, tabled in Parliament, CAG said 25 firms including Essar Power, Hindalco, Tata Steel, Tata Power and Jindal Steel and Power were benefited to the tune of Rs 1.86 lakh crore from coal blocks allocated to them on nomination basis, instead of competitive bidding.

"The government could have tapped a part of this financial benefit by expediting decision on competitive bidding for allocation of coal blocks," CAG said in the report.

The final CAG report is, however, silent on the PMO’s role in scam. The draft CAG report had heavily criticised the PMO in connection with the scam which mainly benefited companies like Tata, Birla and Jindal.

PM must resign: BJP

The Bharatiya Janata Party came down heavily on the UPA government and Prime Minister Manmohan Singh over the CAG report on coal allocation. BJP leader Sushma Swaraj said the Prime Minister was directly responsible for the loss and must resign.

"Prime Minister is directly responsible. He now cannot hide behind any argument. No Raja or Chidambaram can be used as a shield as in the 2G case," Sushma Swaraj said. BJP leader Arun Jaitley added, "PM must introspect and impose the moral censure of quitting the office."

Lashing out at the UPA government, Sushma Swaraj said, "UPA term is full of corruption, this is the biggest scam by the UPA government."

CAG report on aviation: ’Govt favoured GMR, caused losses’

The CAG report on Aviation said that the decision by the Civil Aviation Ministry to award the contract for the Delhi airport to GMR caused humoungous losses to the tax payers and passengers. CAG has put the amount at Rs 3750 crore.

The report also blamed the Airport Authority of India for acting against the interests of the government. Slamming the levy of development fee on passengers using Delhi Airport, the CAG today said the Civil Aviation Ministry violated the bid conditions for the benefit of GMR-led DIAL to the tune of over Rs 3,415 crore and pressed fixing responsibility.

CAG in its audit report on Indira Gandhi International Airport that was tabled in Parliament, said DIAL can potentially earn Rs 1,63,557 crore over a 60-year period from the land given to it on a lease of Rs 100 per annum.

Allowing DIAL to levy Development Fee vitiated the sanctity of bidding process and led to undue benefit of Rs 3,415.35 crore to the private firm, it said.

GMR Infrastructure holds 54 per cent stake in Delhi International Airport Ltd (DIAL).

"It was noticed that Ministry of Civil Aviation and Airport Authority of India, on some occasions, violated the provisions of the transaction documents in the interest of the concessionaire," the official auditor said.

CAG report on power: ’Tata, Reliance favoured’

The CAG report on Ultra Mega Power Projects (UMPP) on Friday said that Reliance Power benefited in the Sasan Ultra Mega Power Project, the country’s first domestic, coal-based project.

It said that the government gave the company permission to use excess coal from three blocks allocated that had been allocated for the power project and that this was not only a violation of the bidding process but also benefited Reliance Power.

Reliance Power had reportedly said at the time of the award of contract that since it would be able to use 20 million tonnes from the two blocks, there would be sufficient coal for the Sasan UMPP.

The report said that the allocation of the third coal block - Chhatrasal - must be checked to ensure fair play.

"Audit has estimated the financial benefit that will accrue to the project developer on the basis of comparison of tariff of Sasan project with that of Chitrangi (the third coal block). The overall financial benefit to Reliance Power due to impact of difference in tariff works out Rs 29,033 crore with a net present value of Rs 11,852 crore," the report said.

Courtesy : CNN IBN