Pawan Ruia's fall from favour

A state police team recently arrested the Ruia group chairman in connection with a complaint of theft lodged by the railways last month

The seeds of Pawan Ruia's downfall were sown about seven years earlier.

It was August 2009. Mamata Banerjee, now Bengal's chief minister and then the Union railways minister, was meeting industrialists for the first time since her agitation had driven out the Nano project from Bengal. She pulled him up, asking whether he wanted to close down Dunlop and why Jessop (both companies run by him) had not met its contractual obligations to the railways.

The story moved full circle on Saturday, when a state police team arrested the Ruia group chairman in connection with a complaint of theft lodged by the railways last month.

"I had personally taken interest in reviving Dunlop but Pawan Ruia was not interested. He was only interested in the real estate and other assets of Dunlop and Jessop," says Partha Chatterjee, higher education minister and former commerce and industry minister in the Banerjee government.

"Ruia was given many opportunities to start production from Dunlop's Sahaganj (near Kolkata) factory but he never got down to doing it. He was asked to submit revival schemes for Dunlop and Jessop, so that the government could facilitate in whichever way possible. The schemes he submitted were not viable. In 2014, a tripartite agreement was signed between the government, management and trade unions but in the very second month, he deviated from it," said former labour minister Purnendu Bose.

However, Ruia's equation with the state government wasn't always this strained. He'd bought a controlling stake in Dunlop in 2005 from Manu Chhabria's Jumbo group. In 2006, the Sahaganj factory was reopened. Buddhadeb Bhattacharjee, then the chief minister, had taken pride in making the announcement. Ruia was then at his peak. In 2003, he'd acquired Jessop in the central government's divestment programme, and managed to turn it around.

It earned him the Left Front government's trust. Iin the years that followed, it came to his help more than once. In 2009, when electricity arrears held up production at Sahaganj, then industry minister Nirupam Sen resolved the issue with the power department. It prompted withdrawal of the 'suspension of work' order at the factory. Again, till 2010, Dunlop enjoyed protection from its unsecured creditors under the West Bengal Relief Undertakings (Special Provisions) Act.

That, however, was not renewed by the Banerjee government. At one point, Ruia did tried to mend matters with Banerjee, who then promised to help reopen Sahaganj. The meeting took place at Banerjee's home. But, Bose notes, there was no meaningful production ever from Sahaganj factory.

In the run-up to the Lok Sabha election of 2014, Ruia took a break from trying to get on the right side of Banerjee, and reportedly started getting closer to the Bharatiya Janata Party. Observers note he was one of the principal sponsors of the India Economic Convention in Delhi, where Narendra Modi, unveiled his governance agenda to business heads and economic experts, as his party's prime ministerial candidate.

In the end, nothing worked. Ahead of the assembly election in Bengal this year, the Banerjee government got two Bills enacted to take managerial control of Jessop and Dunlop.

"We had to take on Ruia's liabilities. We are paying the workers (each) Rs 10,000 a month," Bose said.

Finally, in October, when there were fire incidents at Jessop, the state government and the fire department charged Ruia under penal code sections 435 (mischief by fire or explosive substance with intent to cause damage), 436 (mischief by fire or explosive substance with intent to destroy house) and 120B (criminal conspiracy). And, the curtains came down on Ruia's empire.

Crossed lines

2003: Acquires Jessop as part of Centre's divestment;

2005: Acquires controlling stake in Dunlop;

2009: Announces suspension of work at latter's Sahaganj unit; Mamata Banerjee asks Ruia what intention is;

2011: Banerjee government doesn't extend earlier protection under West Bengal Relief Undertakings (Special Provisions) Act;

2014: Ruia asked to send revival schemes for Dunlop and Jessop;

2016: Banerjee government passes Bills to take over Jessop and Dunlop; Ruia arrested by Bengal police.