Mr. Srikant Jena's letter to the CM with several allegations

(letter to CM Naveel Patnaik and a press release) 

[NOTE: Our goal is to evaluate whether Mr. Jena's allegations have any merit or not.]

Mr. Jena's letter to Naveen Patnaik

Srikant Jena,                                                    Bhubaneswar,
Former Union Minister

Dear Chief Minister,
I am once again writing this to you at a very crucial juncture of the state's history with a host of domestic and international companies rushing the state to loot the bounty of nature – the most valued minerals. The rush is not for any charity. You have made a deliberate
attempt to woo these companies by selling off minerals only to enrich yourself and your cronies.

This explains as to why you did not follow the best of the international practices of valuing these minerals at market price. The state's economy is characterized by lowest per capita income in the country largely due to handing over our high value mineral resources to the private companies and individuals for a song.

The classic example is the Orissa Mining Corporation OMC], which has not followed your own industrial policy as well as the state undertaking's laid-down procedures of transparent tendering process to fetch the real market value of the minerals.  Is it not a well-conspired design to defraud the state of Orissa when you are letting the OMC follow double standard while selling its iron ore and  chrome ore through tender route and bauxite on negotiation route?

What made you to direct the OMC to sell bauxite ore to Vedanta Alumina Ltd [VAL] through an agreement causing the state exchequer a loss of more  than Rs 50,000 crore? What will be your stand if you are asked to sell chrome and iron ore on the same conditions [mining cost + royalty] that the OMC had agreed in the case of VAL.  [See 2.3.3 of the OMC's
Agreement with the VAL – The Long Term Purchase Agreement]

The vested nexus between Vedanta boss, Anil Agarwal and you had become amply clear when the OMC reacting to my press conference issued a press release on October 19, 2004 saying, "Bauxite has no value nor traded". In less than two years, your mines minister, Mr Padmanav Behera on July 21, 2006 at a press conference had said, "Bauxite has
value and traded too with a price tag of Rs 248 per ton in the country, and we are selling per ton of bauxite at Rs 178 to Vedanta". In fact, it is much much more than what the minister admitted. Today, the international price of alumina grade bauxite is about $ 50 [Rs 2350].

Why did not the state government go for global tender for selling the bauxite ore, which is a transparent process? The minister is taking refuge in the MoU signed by the previous Congress government in 1997.  The MoUs are not sacrosanct and that too the 1997 MoU became redundant in 2003, when you signed a MoU with Vedanta. It is a ploy to defend
the indefensible. Mr Chief Minister, will you accept an offer from a Co-operative or a Company for sell of the same bauxite from the OMC at a price of Rs 500 per ton instead of Rs 178 offered to Vedanta with all conditions intact? More so, the Organisation will not only set up a refinery and a smelter of the same capacity of Vedanta but also will set up two
universities in the state of the same size offered by Vedanta. It is a shame that you have been hiding and not responding to my repeated letters on these vital issues and instead using the OMC and the minister to respond on your behalf just to cover up the new millennium's mega-scam.

Let me make it very clear that you can't escape from the public scrutiny for acting hand-in-glove with Anil Agarwal in looting the state's wealth. Hope, good sense will prevail on you and your government will cancel the agreement with Vedanta in the vital
interest of Orissa in general, and Kalahandi, in particular.

[SRIKANT JENA]


Press Release

Orissa chief minister, Naveen Patnaik appears to be in a hurry to get his friend and mentor Anil Agarwal of Vedanta Alumina Ltd [VAL] to loot the state. The chief minister has failed to reply our charges of undue favours shown by the Orissa Mining Corporation [OMC] to VAL
through an agreement that smacks of the worst ever scam of over Rs 50,000 crore.

Now fresh attempt is being made to divert the attention of the public in the guise of setting up of a university. What a way to get the much maligned private sector company to offer lollypops to the people of Orissa! It is not surprising at all that the Naveen Patnaik government on Wednesday signed a MoU with VAL to cover up the hand-in-glove deal in the garb of setting up of a university.

The OMC and VAL signed an agreement on the utilisation of 150 million tons of valuable bauxite deposits by the latter almost at no cost.  The agreement was signed at the dictates of Mr Patnaik himself and it established beyond doubt the bonhomie between Val chief, Anil Agarwal and the chief minister.

This is simply criminal offense against the people of the state. In a market driven economy, how can the value of minerals be dictated by Mr Patnaik and his cronies? Is it not criminal to allow  the London based company to enter into an agreement with the OMC by just paying royalty, which is piddle sum?

Why did the OMC agree to handover bauxite ore to VAL at a meager price of Rs 64 against the market price of about Rs 2500 per ton of bauxite thereby losing Rs 50,000 crore? It is ironical that the OMC follows double standard while selling its iron ore and chrome ore through tender route where as it has agreed to sell off bauxite ore without tender
violating all norms.

OPCC will keep on exposing the murky deal till it is scrapped and the culprit Naveen Patnaik is booked on the charges of fraud and undue favours shown to his friend, Mr Agarwal.