Enron educates India

WHEN the new US Ambassador arrived in Delhi a few months ago, his first public statement was that the future of Indo-US economic relations could be summed up in five little letters: Enron. Hardly surprising. US Ambassadors are political appointees.

And Enron was the single biggest funder of President George W. Bush’s election campaign. But, in fact, the Ambassador’s remark had little to do with party politics and much more to do with US power play, for his predecessor had taken much the same line in asking rhetorically in his farewell interview to a pink paper whether Enron could have happened in China, thus proving to his complete satisfaction that it was India not the US that is to blame for the pathetic failure of foreign direct investment to fuel growth in India’s post-reforms economy.

The Indian right has such a divine faith in the market that their most articulate ideologue could find nothing but praise for the market having punished Enron for their cupidity much quicker and more effectively than the long arm of the law could have done. Thus Enron’s crookedness is also invoked to justify our transition out of stodgy socialism. What the right wing forgets is that while it is of little consequence to us as Indians whether the small American investor, who put his savings and faith in the booming stock of Enron and its multifarious ventures, was cheated or not, it does matter to us enormously as Indians that Enron were flouting American law. For does that not also indicate that they were up to nefarious sharp practice in India as well?

Of course, a polity and legal system that can do nothing about Union Carbide’s Walter Anderson even 17 years after his negligence gassed tens of thousands of innocent Indians working and living in the vicinity of his notorious factory does show that we in our country are tardy in chasing the criminal. And, therefore, it is hardly surprising that no one is really chasing Enron on any criminal charge. Yet, the run-of-the-mill Indian cannot help remembering that it was Enron which introduced an entirely new statement into our political lexicon: it was called ‘Educating India’.

Enron have spent something of the order of $60 million — around Rs 240 crore (pocket money for this former multibillion multinational) — on ‘educating’ Indians into the joys of being bankrupted by one of the world’s biggest corporations. US envoys of every description, ranging down from US Secretaries of Commerce to humble Ambassadors, assured us that neither Enron nor any lily-white American company can give bribes because the US law forbids them from doing so.

Those of us who whispered that Madam 10 per cent in Indonesia and the footwear-loving Imelda Marcos were hardly swayambhu — having been born in the lotus leaf of American corporate corruption (lotus leaf because, like the lotus, American corruption corporate floats above the muck of native corruption) — were told to hush, US investment would not only bring in US dollars but the clean sweet smell of the noble US business ethic — truth, honesty, sincere hard work.

Now we find that Enron’s top officials were busy mostly in ripping off their fellow-Americans. The US Congress is scheduled to begin hearings next week. In our benighted land, there is no hope of a Joint Parliamentary Committee on Enron — there are too many skeletons rattling in too many cupboards. But before we come to the malfeasance of the Enron East India Company, let us check out its technical and management efficiency. Wonderful, is it not, that in Enron, India found a ‘strategic partner’ (Arun Shourie’s favoured phrase) who would set up a joint venture, Dabhol Power Corporation, which would give us uninterrupted quality power at bargain basement prices? Apart from the technical detail that Dabhol was never able to ramp up its output to peak load requirements within the time-period specified in the contract, what is one to make, Arun Shourieji, of the management wizardry of multinational business managers who so skew the terms against the poor Indian partner that they end up not only bankrupting the Indians but going broke themselves?

The right-wing loves to argue that there can be no sustained exploitation of the buyer through power purchase agreements of the kind Enron has entered into, not only in India but the world over, because the first law of the market is that the market will pay only what the market can pay — and the supplier who demands more will have to suck eggs. While doffing my Gandhi topi to the wonderful market which can perform such market miracles, I ask sotto voce whether it was to teach ourselves how to bankrupt ourselves — and them — that we got strategic partners like Enron — and ourselves — on the fast-track to mutual bankruptcy?

As for corrupting young Indian capitalist minds, since our Parliament has not even discussed Enron — let alone investigated it — might I through this column appeal to the US Congress to also enlighten us on the following points:

• Why did the 13-day Vajpayee government approve the Union government counter-guarantee to Enron at a five-minute lunch break meeting of the cabinet on May 27, 1996, hours before Prime Minister Vajpayee Mark-I was to call on the Rashtrapati to say he preferred to resign than face defeat on the floor of the House?
  
• Who was his Finance Minister? Wrong if you said Yashwant Sinha; right if you answered Jaswant Singh, opening batsman for the American team in South Block. What was the fire in his pants that he insisted on the Vajpayee government issuing the counter-guarantee even as that government was preparing for its thehravin?
  
• Why did Jaswant Singh in 1995 assume the role of chief propagandist for the Shiv Sena-revised Dabhol contract, which jacked up capacity three times to 2000 unwanted and unsaleable megawatts, then placed on their indigent Indian partner the entire financial burden of paying Oman for its gas, paying Japan for transporting the gas, paying for the jetty and paying Enron’s fat-cat friends - — General Electric and Bechtel — for a regassification facility designed for 5 million units when only 3 million were to be processed? And who leaned on our banks and financial institutions to lend 6000 crores of our rupees to a multinational we thought would be bringing in foreign direct investment? Who all were educated in Enron University — Mumbaikars alone or Dilliwallahs as well?
  
• What was the pressure which Rebecca Mark of Enron, Mumbai got Bal Thackeray to put on Jaswant Singh and Atal Bihari Vajpayee — and for what consideration in educational grants — to force the pace of the counter-guarantee?
• And, finally, the 60 million dollar question: who got the 60 million dollars?

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