Vinod Rai’s zero-sum game is on firm ground

The Congress may take exception to Vinod Rai’s zeroes, but the Comptroller and Auditor General has identified where they came from. Twenty-five beneficiaries and a loss of over Rs 3.78 lakh crore to the public exchequer, is what the Comptroller and Auditor General’s says in the three stunning reports on coal-block allocation, airport modernisation and ultra mega power projects tabled in Parliament on Friday. Apart from taking the UPA’s scam figures to an unheard of level, the reports have had the Opposition crying hoarse that it’s “the biggest ever corruption scandal in Indian history”.

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

Take the coal sector. A slew of private firms—big, small and marginal—were given captive coal fields with extractable reserves worth 1010.575 million tonnes, under the economist Prime Minister Manmohan’s guidance, whose government is currently reeling under high fiscal deficit.

According to CAG estimates, financial gains to private beneficiaries of the coal blocks add up to Rs 1.86 lakh crore. The auditor’s calculation is based on average cost of production and average sale price of Opencast mines of Coal India Ltd in the year 2010-11. And how were the beneficiaries of this windfall gain chosen?

The CAG report states: “The Screening Committee (comprising of different Union ministries and the states) 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.’’

-Sunday Standard