Similarly, in the case where an unduly high base price was fixed -- below which steel imports would not be allowed freely -- to bail out the steel industry, he says the final price was $ 55 higher than that agreed to at an inter-ministerial meetingearlier. This decision, says Guruswamy, was taken by either Sinha or Commerce Minister Ramakrishna Hegde or Steel Minister Naveen Patnaik. In other words, he feels, someone else's deals were being laid at his door. Guruswamy discusses these controversies in detail with SUNIL JAIN. None of the persons Guruswamy blames chose to join issue with him. Excerpts:

You've alleged that your relations with Sinha soured on the sale of ITC shares held by UTI to BAT Plc. What happened?

There was a proposal to get UTI to sell around 6 per cent of its holdings in ITC to BAT Plc which has been trying to control ITC for a very long time. I argued that if this was to be done, UTI should get a much higher price than the prevailing market one of around Rs 800. I said, in keeping with the international norms, BAT should buy at least 20 per cent of outstanding ITC's shares, and that an open offer should be made by BAT. This would drive prices up. By how much? If you take a normal price-earnings ratio -- HindustanLever's P-E is 55 but let's take 33 -- the price per share should be Rs 2,500 or so. So, by saying BAT should pay three times the price per share and buy thrice as many shares as it wanted to, I increased the price for BAT getting control of ITC by around 9 times.

So what did Sinha do?

Well, at first, he said selling ITC's shares would help UTI get over its liquidity problem. I later put up my first note detailing the kind of price these shares should be sold at in a note to Sinha on January 21. He sent it back saying ``please discuss''. The UTI chief P. Subramanyam was in town, and came to see me, so I showed it to him, and he agreed. I put this on the file, and sent it back to Sinha. He sent it back on January 22, ``advisor, please discuss immediately''. And when I went to meet him on it, he said keep it aside for the time being. You know, there are big people involved, let's not get into this.

Are you saying Sinha was on the take?

Someone else may have been, I'm not charging him withanything, but this was the turning point in our relationship.

Why are you so sure?

On the 23rd of January, that's four days before I put in my papers, I selected his new personal secretary. The old PS was selected by the RSS chief. So, if I had lost his confidence, why would he get me to nominate his PS -- he's the most vital part of his office.

But Sinha's office says you were exceeding your brief and instructing the FIs?

Sinha himself has written to Deve Gowda saying all decisions were taken holistically by the ministry. What he's saying now is contradictory. The anger is overcoming reason, from anger arises confusion of memory, from that comes loss of reason...

On the Essar bailout package...

Essar's are the most efficient steel plant. They had a FRN (forex) loan which was due for payment, they were in the market to borrow this but the sanctions prevented foreign lenders from lending them the money. It was the government's policy last year -- the minister, the PM, all saidwe will take all steps to help those hit by the sanctions. Essar had offers from Lehman Brothers and others which got affected by the sanctions. The FIs, however, were seen to be dragging their feet to lend Essar the money because of corporate rivalries and so Sinha asked me to have a look.

But you held a meeting with the FIs where you had Shashi Ruia present.

The Minister conducted the meeting, the meeting was held in the Minister's office with the Minister presiding. He cannot take the plea that he was in the meeting and that I was conducting it. I don't think Sinha's so dumb that he lets his advisor run his office. All invitations for the meeting came from Sinha's office. I didn't call Ruia in, Sinha did -- Ruia was called in after the meeting was over and asked whether he would accept the conditions laid by the FIs. Nor is this the first time industrialists have been present for such meetings. In the meeting on the Hinduja power plant, they were there. It is common in the Finance Ministry forindustrialists to be present. n What about the Rs 300 crore refund of import duties that was sought to be given to the Ruias.

It was not me but the Minister of State who had a meeting on this, I was not present and was not even invited. When my view was asked for by Sinha, I said it should be referred to the Attorney General and his view should be got on whether it was legal.

There is also the issue of excessively high `referral' prices to protect the steel industry from cheaper imports. (Briefly, while global prices for HR coils are around $ 190 a tonne, the Government has said that if imports are made at below a price of $ 302, the imports will not be allowed freely. This allowed local mills to boost prices of their products and, according to users, amounts to a total giveaway of close to Rs 5,000 crore).

I was present in just a couple of meetings of the inter-ministerial committee looking at ways to help the steel industry which was being hurt by the crash in global prices such help forlocal industry is in the BJP manifesto, in the national agenda, and let's not forget Sinha made his career in the BJP as a leading light of the Swadeshi Jagran Manch. The inter-ministerial meeting recommended a price of $ 247 a tonne. How that became $ 302 is a mystery to me. Only the three ministers concerned -- Finance, Commerce and Steel, and the PM, know what happened. They should answer. Mind you, I was not in the administrative loop, so I don't know who put what on the file. The talk was that the ministers all had something to do with it. There were State elections also coming up at that time.

(Neither the Finance Minister nor the Steel Minister wished to comment on the matter despite repeated calls to their offices. A spokesperson of the Commerce Ministry, however, said to The Indian Express, that they just went by the recommendation of the steel ministry on the matter, since that is the procedure.)

Why did you bring up the issue of Staines killing, the Christian aspect in yourresignation letter?

I was basically using it to illustrate the kind of mismanagement that has become endemic, the kind of lack of application of mind, the lack of proper reactions. Basically I was saying the Prime Minister's Office was not providing the kind of bureaucratic leadership or coordinating role which it should. The Christian thing was also a moral issue, the PM had no business calling for a debate on conversion, it is a private matter and does not concern him. Besides, what did we do? Has there been any attempt to catch the man who was absconding, have you seen a poster of him anywhere, or any picture on TV? We could have created the feeling that the state is going to hunt for him. Instead, the Bajrang Dal got a clean chit.

Was this Christian point brought up with a view to joining the Congress?

I'm not joining anyone. I'll run into more Yashwant Sinhas and Vajpayees, and I've had enough of them -- weak people.

What was the reference in your letter about not being able tonominate the new board of the RBI?

Not just the RBI, the same applies to all banks, the IDBI, LIC, UTI, GIC... All are stuck in the PMO for several months. I don't know why. In the case of M.S. Verma of the SBI, Sinha said that the person to succeed Verma should be made managing director for some time, and he recommended a one-year extension for him. The PMO delayed things, and on the last day, the PM woke up and offered a six month extension to Verma. Verma naturally turned it down. But when the PMO wants to act, they act fast. When they wanted to get rid of Bezbaruah, they never consulted the Home Minister, and even faked the affidavit to remove him.