CAG slams Modi govt for "undue" favours to corporates

The Comptroller and Auditor General of India (CAG) has indicted the Gujarat government and state Public Sector Undertakings for extending "undue" benefits to major industrial houses causing a loss of Rs 750 crore to the state exchequer.
The major beneficiaries of government's largesse included big corporate entities like Reliance Industries Ltd (RIL), Essar Steel and Adani Power Ltd (APL), the report for year ended March 31, 2012, said.
The government auditor's report, tabled in the state assembly yesterday, also said the state government tweaked rules to grant land to automaker Ford India and engineering and construction major Larsen and Toubro.

"Gujarat State Petronet Ltd (GSPL) was responsible for deviating from the agreed terms of recovery of gas transportation charges from the specified entry point of the company's pipeline network and this led to passing of undue benefit of Rs 52.27 crore to RIL," the report said.
CAG was of the view that GSPL had failed to safeguard its own interest and passed on undue benefit to RIL.
Similarly, it noted that Gujarat Urja Vikas Nigam Ltd (GUVNL) did not adhere to terms of the Power Purchase Agreement (PPA), which led to short recovery of penalty of Rs 160.26 crore and passing of undue benefit to Adani Power Ltd (APL).

The main Opposition Congress promptly utilised the CAG report to attack the Narendra Modi government, alleging a "collusion" between the state dispensation and corporate houses.

"We have been raising the issue of collusion between corporate houses and the state government at every forum. The corporate houses get undue favours from the state government and in turn they praise the Modi government," Congress spokesman Manish Doshi said.
The state government, however, sought to downplay the issue, saying what the government auditor had noted was "not a scam but just irregularities".
"This is not a scam but in the language of CAG it is called irregularities. The report will go to the Public Accounts Committee and later the state government will take a call on it," Gujarat finance minister Nitin Patel said.