 Hello and welcome to NewsClick. In 2013, the UP government had imposed a fine of 200 crore rupees on one of the projects of Adhani group, saying that it has been violating the green regulations. Now that fine stands cancelled and the officials say that they did not commit any mistake. To discuss the issue, we are joined by Paranjay Guha Thakurtha. Paranjay, welcome to NewsClick once again. So before we go into the details of the project that what it was about, I mean, what are the officials saying and why has this fine been cancelled? A recent report appeared on the 5th of March in the website Scroll.in. It was written by Kumar Sambhav in Mithinseti where it highlighted what has happened. It published the documents, the internal documents of the Ministry of Environment and Forests. According to the writers of this report, they had sent a questionnaire to both the Ministry of Environment and Forests as well as to Mr. Gautam Adani's company. And they didn't get any reply. It appears that there's been a flip-flop. Now this flip-flop began during the United Progressive Alliance government's time. But what it now appears is that the latest sort of directive if you log or recommendation of the Ministry, which again is not new because the last document they talked about is 25th of August 2017. Now the Ministry seems to have internally concluded that the company has done no wrong and caused no damage to the environment. But interestingly, this is largely based on inputs given by the company itself. Now the company right from the very beginning has been saying they've been doing nothing wrong. So I mean, was it basically a U-turn on the part of the BGP government, the NDA government, which is in place today? This U-turn has been happening earlier also. Let's go through the chronology of events. From 2009, in Mundra, the Adani group has set up what is arguably not just, it is certainly India's biggest port in the private sector, but it's one of the biggest port complexes of its kind in the country. Because it's not just one port, it's a huge waterfront project. There are four ports that can handle dry and liquid cargo. There are container terminals, there are railway sidings and on top of all that, there are hundreds of hectares of land which are being, they're lying being used for various purposes. And it's really part of a larger township in which there are various other kind of industrial. So it's like a privately owned mini city because within it is a special economic zone. In fact, the company, which is in the middle of all this, this controversy about whether or not it violated environment laws, is called Adani ports and SCZ limit. And SCZ stands for special economic zone. Now, what had happened is in late 2012 and early 2013, a committee that had been appointed after the Gujarat High Court had raised various questions, the Ministry of Environment and Forests appointed a so-called independent committee which was headed by Sunita Narayan, who is currently the head of the non-government organization called the Center for Science and Environment. Now, this particular committee recorded that there had been very, very widespread damage done to the mangroves in that area. And it recommended that a penalty of 200 crore rupees or 1% of the total project cost, whichever is higher, be imposed over and above whatever corporate social responsibility that the Adani group is supposed to be fulfilling. Now, what has happened is after that in late 2003, in September 2003 and early 2002, based on various responses, there was two and four. Then it sends a show cost notice to the company, the company respond, but then it sticks to the position that, yes, there should be a imposition of a fine. Now, in the meanwhile, what is happening? This whole question of whether you need a 200 crore environmental restoration upfront, within the ministry, there are some doubts happening and there are some questioning going on internally. And the question is whether such a fund is legally tenable or legally sound or not. Just to clarify a bit, this committee that you're talking about, that this two-in-four that happened, is it 2003 for or it's 13? I'm sorry, it's 13-14. If I said before I stand corrected, it all happened in 13-14. Between September 2013 and January 2013. Now, what has happened is, as I was saying, the ministry said that, yes, the fine should be imposed. But the questions were raised from around April 2014. While the UPA government is in its last leg, really, the last few months, as to whether this environmental restoration fund, 200 crores, is legally sustainable or not. Now what happens is, then meanwhile, they've started considering other proposals, including a proposal for a ship-breaking yard at a cost of about 146.8 crore or so. Now what happens? By that time, now the NDA government has come to power. Mr. Narendra Modi, who, as we all know, has always been associated quite closely with Sri Gautam Adani and we know that in the run-up to the elections, he was using Adani Group's aircraft to campaign different parts of the country. By September 2015, that means about a year and a half after this government, or less than a year and a half after the new government has come to power, the Modi government is in power, the ministry has taken a complete U-turn. And it says, no, there are, you know, this decision to have a 200 crore penalty is not legal. And at the same time, it asks for studies to look at how the environment can be restored. Now interestingly, these studies are being done with complete support and cooperation of the Adani Group. Now within the ministry, there is a lot of to-and-froing happening. Now Business Standard published a report in June 2016 saying, no, they believe yes, the fine should be imposed as a 200 crore environment restoration front should take. Now by October of 2016, these studies have been completed. Meanwhile, the government is going ahead and processing its new project for the ship-breaking yard. Now, company meanwhile has said that it has already paid about 3.16 crore for these various studies and these studies are still going on and are not being completed. This is in July 2017. And finally, in August 2017, as mentioned, this whole, I mean, the Ministry of Environment and Forest says internally concludes that the company has done no wrong and caused no damage to the environment. So I mean, it's amazing the kind of flip-flop that has happened. There are basically two questions that arise from this entire to-and-fro that has been happening. One is when this entire port was being set up and this entire industry was being set up there. Township, entire township. So was there no follow-up at that moment and was there no follow-up about whether they are violating the norms or not? Second thing, who are the people who are associated with or which is the committee that is that was looking after this entire violation after the India government has come to power? You know, these have all been internal committees. There hasn't been an external committee which is autonomous of the government. These have been internal committees and internal evaluation that has been done. So that's why I'm saying the credibility of these reports are bound to be questioned. The earlier committee was set up because the Gujarat High Court had asked the Ministry of Environment and Forest, please tell us what's going on. And that point of time, a committee was set up with Sunita Narayan. So Sunita Narayan was not part of the government and therefore that report had clearly said that this 200 crore fine should be imposed. Now what is very very clear is that the ministry itself was going to and fro during the last months of the UPA regime and now it's done a complete about turn. So also let's look at Gautam Adani separately. There have been a lot of speculations against him on different projects. One of his Australian projects stands cancelled. Not yet. Not yet but there are prospects of it's it's it's involvement a lot of controversial this is the coal mining project in Queensland. And also I mean his name has been cropping up again popping up again and again when it comes to NPAs. Subramaniam Swami has said that he might be the biggest I mean biggest industry owner who has the highest amount of NPAs artist. Okay, let's go step by step. What's happening in Australia is another story altogether. It's a very active civil society movement and what we are seeing is the Union government or the federal government of Australia is in power with just the majority of one. So it's a very very sort of a tenuous kind of a situation. Now within both the ruling party as well as the opposition party there are people who have openly come out and not supported the Adani power project and especially not supported a proposal for the Australian government its own fund to give it. Now what has been planned in Queensland the Galilee Basin is going to be the world's biggest greenfield coal mining project. It's not just a coal mining project there's an entire railroad there's an entire port that is to be revamped at Abbott Point. Now one of the environmental issues is that the great barrier reef which is a world heritage site according to the United Nations education scientific and cultural organization there is a fear that that particular area its environment its ecology would be irreparably damaged. The other part of the controversy is the local the the originals and their lands and how it will be appropriated. Then there is a question of some of the wildlife of that area itself and that's not all. The bigger issue is coal itself you know if you're going to build what will be the world's largest greenfield project because the whole idea of building that railroad is that once you have one mine it opens the way for a series of mines. Now it won't be the world's biggest coal mine it might be somewhere in the top 10 but it would be the biggest greenfield new project. Now there's a huge controversy the Adani group sought Chinese financial assistance it has not been forthcoming when Mr Modi had gone to Canberra during the G20 meeting and come back at that time the head of the state bank of India was Mrs Arun Dutty Bhattacharya with Gautam Adani they signed the MOU that money has not come through that would have been a unique loan because the first time India's biggest bank would be would be advancing or a proposal to advance about a billion dollars in foreign currency to a foreign project by a promoter of Indian origin be that as it may none of these things have come. So the very viability of the project is itself being questioned and the financial viability especially at a time the world is trying to move away from coal towards renewables. Now to come to your second point Dr Subramaniam Swami recently tweeted that Gautam Adani seems to be a trapeze artist and that his group allegedly has non-performing assets to the tune of 72,000 crore rupees and this is Dr Swami's claim I don't know how he's arrived at this figure you know if you look at even the top major major companies in the Adani group Adani Par, Adani enterprises, Adani ports, Adani terminal etc etc if you look at all these projects put together they would probably have total debts in excess of a hundred thousand crore but how much of it is non-performing is another story but what's interesting is that Dr Swami hasn't stopped there he's saying Mr Gautam Adani should be held accountable otherwise he thinks what will be inevitable would be a public interest litigation. Now interestingly here is Dr Swami who is a ruling party MP taking on a big industrialist who is known to be close to the prime minister and he's not just any ordinary person his right has been his rise is his has been truly spectacular and meteoric he is according to Forbes magazine the 10th richest man in the country and his family has a net worth in excess of 11 billion dollars so this is Forbes claim so it's it's quite interesting that this kind of a veiled if you like an attack has come from a ruling party member of parliament. So let's look at NPA part of Mr Adani and you said it could be over 1000 crore no total debt total debt total debt we don't know you see calculating non-performing assets itself is not an easy exercise especially when you want to look at a group because if you want to look at the entire Adani group you may have half a dozen companies which are publicly listed but you would have over a hundred companies perhaps close to 200 companies which are part of the group which are not publicly listed second point to compile this data and find out what are the total NPS is not easy because again the question of classification comes for instance recently the Reserve Bank of India has changed the way you would classify debts for instance in the power sector now in Mundra in that same area you have Adani power which has setting up one of which has set up one of India's biggest what they call ultra mega power projects now on account of a various reasons including a supreme court ruling that that took place the whole that project questions are being raised about the viability and if newspaper reports are to be believed there are attempts to even you know sell that power or or get get other agencies or other private players or even the Gujarat government or the state electricity board to bail it out and it's not just Adani power which is financially strapped it's also a Tata group project called coastal Gujarat so we have at least two of these major projects in that area which appear to be financially troubled now we can't say exactly therefore what are the total non-performing assets of the Adani group but it's surely quite high so I mean even if you look at the environmental clearance that the NDA government has been giving in past three four years it has been at it has risen to a massive scale as soon as they come to power they clear various projects which were stuck due to environmental clearance it was supposed to be due to the improvement of the ease of doing business so I mean what implications does these cases have because if you remove a fine every corporate house will think that this can be easily done you know I think the credibility of the ministry of environment and forests will take a huge fashion and it will send out a wrong signal completely that if you follow a non-transparent process a non-credible process to decide whether a particular project in this case is Adani Adani's project whether it's violated environmental rules or not and if you don't do it in a transparent manner if you don't do it in a manner that's fair it's going to just send the wrong signal that in the name of ease of doing business you can get away doing anything and and I think that's really not the right message that should be coming out it should be the government should be sending so was there also no involvement or no intervention on behalf of NGT on this entire issue so far it hasn't you see so far no so it also has to do with the fact that how these so-called autonomous bodies have been working on the dictates of the government on no you know this whole thing about autonomy is a big myth you know whether it be regulatory authorities whether it be judicial authorities whether it be quasi judicial authorities whether it be tribunals we often do find a number of instances when a their authority or their autonomy or their independence has been eroded and but what we find is something very very interesting is even when these authorities issue certain orders they're not being followed with Sri Sri Ravi Shankar's case Sri Sri Ravi Shankar the the the flood plains of the Yamuna being so you know the whole regulatory mechanism okay this is a right-wing government it believes in free enterprise capitalism it believes in private enterprise or it believes in supporting enterprise and nowhere in the world not even in the countries which are the most ardent supporters of free enterprise capitalism and a market-oriented economy can you argue that private capital should have a completely free hand without say for instance having independent regulators adequately empowered with punitive powers and headed by individuals who are not just retired bureaucrats but people who have spined who are truly independent and autonomous i'll give you one more example to highlight the point the government has made a big thing that now it's opening up coal mining to the private sector has it set up a regulator has it set up a coal mining regulatory authority now it first opens it out and then drags its feet how long did the government take to set up a real estate regulatory authority and and look at all the questions that are being raised about the manner in which so many regulatory authorities are working today and and the repeated accusations that they've been partisan they're not being that they are not unbiased that they've been biased and the very very long cumbersome process the legal process the redressal mechanisms are so long and so cumbersome that that itself is another story that's all the time we have for today paranjaya and hopefully as these things proceed and maybe somebody will file a p i l on it and see what we will get dr swami's support so let's we'll follow this issue again thanks a lot for giving us your time thank you that's all the time we have for news click keep following our website and our facebook page