Anil seeks probe into RIL's 'huge scandal' in gas investments

Some More Indications of how RIL has purchased Petroleum Ministry. This time from an insider like Anil Ambani.

30 Jul, 2009 1627hrs IST PTI

NEW DELHI: Questioning clearance by junior oil ministry officials of the near four-fold hike in costs to Rs 45,000 crore for gas fields by Mukesh Ambani-led RIL, Anil Ambani on Thursday demanded a probe into the "huge scandal."

"I am deeply concerned that RIL's capital expenditure of nearly Rs 45,000 crore on KG-D6 fields as confirmed in Parliament by the petroleum minister and which is nearly 33% of India's total defence budget was cleared by a management committee..." he said in an e-mailed interview.

"The committee comprised of one junior level official each from the petroleum ministry and director general of Hydrocarbon and two representatives of the contractor (RIL)... talk about conflict of interest," he said, adding that any expenditure above Rs 150 crore by any arm of government goes to the Cabinet committee of economic affairs for approval.

Given the incredibly high stakes involved, the comptroller and auditor General and central vigilance commission should examine relevant facts and find out if capex was overstated, Anil said, pointing that budgeted expenditure of RIL for peak production of 40 mmscmd was only Rs 12,000 crore in 2004.

Anil alleged that petroleum ministry, particularly after the changes in 2006 (when Murli Deora took over as minister), was colluding with RIL in its quest to make "super-normal profits of Rs 50,000 crore" at the cost of power and fertiliser sectors.

Anil hoped that public accountability bodies like CAG and CVC will examine the facts as he feared that ultimately the users of gas would end up paying for RIL's capital expenditure.

Appropriate action should be taken "if indeed they (CAG/CVC) find that the capex has been over-stated, and as a result huge losses caused to the public exchequer and all end-users of the gas produced from KG-D6," he said.

He said the surge in capex has even surprised independent observers and the government could have lost over Rs 30,000 crore by this "gold-plating of costs".

On his dispute over gas supply with Reliance Industries, Anil said: "It is a huge scandal that at the price of USD 4.20, RIL wants to make super normal profits of over Rs 50,000 crore (10-billion dollar) - which will ultimately be paid for by hundreds of millions of end-consumers."

Anil, who wants gas for his group firm RNRL at USD 2.34 per mmBtu as per an MoU with RIL, said further that "RIL has a short term monopoly, and to perpetuate this monopoly, and earn disproportionate profits at the cost of the people, RIL is spreading misinformation in the public domain to ensure a higher price for its gas."

As per the Production Sharing Contract, RIL is entitled to "first recover its entire capital expenditure from the revenues from sale of gas, before even the government gets any meaningful share."

Anil also raised questions over prohibitively high transportation cots for KG-D6 gas, while suggesting a probe by power and gas sector regulators like PNGRB, CERC and SERC.

He said that pipeline networks in the country were operating on a cost-plus basis, and therefore, end-users from power and fertiliser sectors were, in effect, paying for the networks too.

"To my mind, there is a strong case to revisit the issue of transportation costs for KG-D6 gas, probably the highest in the world, by the PNGRB, the pipeline regulator. Presently, these are pegged at a prohibitive USD 1.25, or 30 per cent of the base gas price!

"Further, with new tax breaks recently announced, the entire cost of setting up the gas pipeline network has been allowed to be written off in the very first year -- a special and unique benefit not given to any other capital intensive sector. It is only fair that the benefits of these tax breaks be passed on, and gas transportation costs be brought down to near zero."

He expressed the "hope that the regulators in gas and power sectors such as PNGRB, CERC and SERC, would examine this aspect more carefully."

At RNRL's AGM earlier this week, Anil also pointed out that the gas transportation company was no longer owned by RIL and it had been sold to the promoters of RIL for a "princely sum of Rs 5 lakhs, and turned into a privately held company."

http://m.timesofindia.com/PDATOI/articleshow/4838079.cms

RIL wants govt to free retail oil prices

What do you think will happen now that Reliance is losing??

TIMES NEWS NETWORK
New Delhi: It’s a double whammy for Mukesh Ambani-controlled Reliance Industries Ltd. While demand for petroproducts is falling overseas due to global recession, the company’s mainstay refinery in Jamnagar is set to lose its export-oriented unit (EoU) status entailing tax incentives next month as the term expires.
“India has surplus refining capacity ... and some of them converted their plants into EoU and SEZ (special economic zone) status ... today they are having difficulty in selling in export market so they want to sell (fuel) in domestic market,” Planning Commission member (energy) Surya P Sethi told a brainstorming on deregulation of domestic fuel prices organised by Observer Research Foundation on Monday. Sethi did not identify Reliance by name.
Reliance had shut its chain of around 1,500 petrol pumps once domestic retail operations became unprofitable in the face of artificially low prices set by the government for fuels being sold by the state-run marketers during crude’s high run. While the government compensated its firms through bankable IoUs, Reliance did not enjoy that cushion and sought refuge in export status for its 33-million-tonne Jamnagar refinery.
Restarting domestic sales will remain an uncertain proposition unless the government let go of controls on retail prices. Any profit Reliance makes on motor fuels at prevailing retail and crude prices will evaporate the moment there is any upswing in global oil, which will force the government suppress prices artificially to avoid taking the politically unpalatable step of raising prices.
No wonder, Reliance refinery business head P Raghavendran made a strong pitch for deregulation. “We have no escaping (from freeing petrol and diesel pricing) ... the rest of the world is allowing (international crude oil) prices to get reflected in retail prices ...You have to let it (international rates) pass on to the consumers.”
ORF’s Ashok Dhar, a former Reliance executive, said allowing global trends to reflect in domestic pricing would result in petrol rates being further lowered by Rs 1.58 a litre and diesel by Rs 2.93 per litre in Delhi.
The political establishment’s opposition to fuel price deregulation was articulated by CPM’s Dipankar Mukherjee. “You cannot leave it to the market to decide,” he said and wanted retail prices to reflect cost of crude, refining and marketing expense.

The Mystery Unravels Further- Nexus Between Reliance and Govt

There is a serious doubt in the minds of all thinking indviduals that the Oil Strike was forced by Certain People to show the PSU oil companies in a bad light and so pave the way for rampant Privatisation of this Crucial Sector stiffling opposition from other parties by proving a point "that PSUs cannot be trusted!!" Look what Mr R.S. Pandey has said in this news item quoted below.

Our earlier stories were "The nexus between Reliance and Govt" and "The Mysterious Affair at Styles", complemented by our arguments at "The Govt is Celebrating its Success" , what Mr R.S. Pandey said. All posts can be seen by choosing Label="Reliance"

http://www.indiaprwire.com/businessnews/20090111/36816.htm
Quote:

Oil strike should not occur again: Petroleum secretary

New Delhi, Delhi, India, 2009-01-11 18:45:02

The oil industry will do 'introspection' to ensure that there is no recurrence of the strike that paralysed the economy this week, Petroleum Secretary R.S. Pandey said here Sunday.

'We have to ensure that the trauma does not occur again. The oil industry will have to undertake introspection,' Pandey told reporters at the inauguration of the media centre for the country's premier oil and gas conference, Petrotech 2009.

Nearly 45,000 employees of the public sector energy companies went on strike from Wednesday, demanding higher salaries. It lasted three days, with retail petrol vends closing down and fertilizer and power plants shutting shop due to lack of oil supplies.

The government took a tough stand, invoking the Essential Services Maintenance Act in several places. The state-run oil upstream major ONGC suspended 64 employees and IndianOil took action against three.

Petroleum Secretary Pandey said their fate after the strike would be decided by the companies.

Asked if the management of the oil companies would be taken to task for reportedly giving covert support to the striking employees, Pandey said: 'I am not aware of any such action'. He added that most of the gas and petrol supplies would be 'completely normal by (Sunday) night'.
All IndianOil refineries are back in action and in full capacity, except for the Gujarat refinery which has been deliberately kept at a lower capacity due to technical reasons.

ONGC chairman R.S. Sharma noted that the western offshore production has nearly gone back to normal. 'In the morning, the production was at 310 million barrels, compared to the regular rate of 342 million barrels,' he said.

Describing the oil sector employees as 'intransigent', the top official in the petroleum and natural gas ministry said the government has already constituted a high-level committee, chaired by Home Minister P. Chidambaram, to look into the demands of the oil sector officials.

'If they have genuine grievances, then these will be redressed,' he said.

On the role of private players in the energy retail sector, Pandey said: 'The government will seriously consider how to associate private players in the system. But what the decision will be, whether positive or negative, I cannot say.'

In the private sector, Essar Oil has already been operating over 1,000 outlets in the country, while Reliance has also indicated it wanted to re-enter the retail market.

Pandey added that public sector oil companies were still calculating the losses due to the strike.
The secretary did not reply when asked if there would be a revision of fuel prices, as indicated by Petroleum Minister Murli Deora in Mumbai Saturday. 'Any clear discussion on the price will take place at the cabinet,' he said.

Endquote

Media forgot to point out that had Mr Murli Deora not been hinting at Price Cuts, the dealers would have stocked up their tanks in view of the impending strike which was well announced in advance. But who wants to lose money? So the dealers did not stock product. So while Someone at the top refused to listen to a single demand wanting OIL PSUs to go on a strike so that it can pave the way for the Pvt players to come in in a massive way, someone else actually created the dry outs!!

There are other posts on this blog which shows how much concern Reliance has for the nation as they showed by their practices so far.

NTPC case: Ministry, counsel speak in different voices

Conspiracy hatched by Reliance is not something new. Unlike Tatas and Birlas this Industrial group came into existence and rose to its stupendous heights in Just One Generation and such fast growth cannot be achieved through normal routes. The Indian Public however sees and knows only what the Media tells them. Well we too are using the same media to collate some news items which seems to point towards something sinister at play.

Our earlier stories were "The nexus between Reliance and Govt" and "The Mysterious Affair at Styles", complemented by our arguments at "The Govt is Celebrating its Success" , what Mr R.S. Pandey said. All posts can be seen by choosing Label="Reliance"

Quote
http://www.business-standard.com/india/storypage.php?autono=332638

NTPC case: Ministry, counsel speak in different voices

After the power ministry and state-owned power utility NTPC took strong exception to the petroleum and natural gas ministry’s lawyer Tejinder Singh Doabia telling the Bombay High Court last Thursday that the RIL-NTPC deal was not a ‘concluded’ one, the petroleum ministry has asked the lawyer to withdraw his statement when the case is heard again on September 1.

The twist is that while the ministry says Doabia’s interjection in the Mukesh-Anil Ambani case (Reliance Industries Limited versus Reliance Natural Resources Limited) was beyond his brief, Doabia insists it was the ministry which instructed him to do so.

In a letter to Joint Secretary DN Narasimha Raju last Saturday, Doabia refers to an earlier e-mail by him on August 13 where he had asked the ministry for a copy of the RIL-NTPC agreement so that he could study it for arguing his case.

In this e-mail, Doabia had said: “I believe that this was not final …” and that, in any case, “the price fixed in the NTPC agreement is subject to approval of Government of India”. His letter of August 23 then goes on to say:

“In response to the above e-mail, I was instructed that there is no concluded agreement and mere letter of intent was issued.”

Doabia’s letter comes a day after he was telephoned by Raju asking for details of what had actually transpired in the Bombay High Court following media reports on the proceedings.

Doabia chose not to comment on the letter when asked by Business Standard, saying, “No, no, I will not comment … there has already been a lot of muck on this.”

Petroleum Secretary RS Pandey and Raju, however, both confirmed they had indeed received Doabia’s letter though Pandey stressed all that mattered was that Doabia had been asked to withdraw his statement.

When asked, Pandey said he had no idea who had briefed Doabia to say what he had — Doabia had been hired four or five months ago, Pandey said, and would have briefed by a variety of officials.

Raju said he had never briefed Doabia, while Pandey said he was unaware of whether his predecessor had left any instructions saying the deal was not ‘concluded’.

In 2003, Reliance had won a global bid edging out bidders like Shell to supply NTPC 12 million metric standard cubic metres per day (mmscmd) of gas for 17 years at a price of $2.34 per mmBtu (million metric British thermal units).

Towards the end of 2005, Reliance changed some of the terms of the contract — instead of an unlimited liability in case it failed to supply NTPC the requisite gas, Reliance capped its liability. NTPC refused to accept this and other changes and did not sign on the new terms.

Instead, it filed a case in the Bombay High Court asking that Reliance be told to fulfill its original contract. So, when Doabia said the NTPC-RIL deal was not a ‘concluded’ one, he effectively demolished NTPC’s entire case.

The NTPC case is important in the Reliance Industries Limited-Reliance Natural Resources Limited fight since the commercial terms of their contract were similar to those in the NTPC case. If there is no ‘concluded’ NTPC-RIL contract, there can logically be no concluded RIL-RRNL contract either.

Endquote

The Mysterious Affair at Styles - An Agatha Christie Mystery

With impeccable timing Hercule Poirot, the renowned Belgian detective, makes his dramatic entrance on to the English crime stage. Recently, there had been some strange goings on at Styles St Mary. Evelyn, constant companion to old Mrs Inglethorp, had stormed out of the house muttering something about 'a lot of sharks'. And with her, something indefinable had gone from the atmosphere. Her presence had spelt security; now the air seemed rife with suspicion and impending evil. A shattered coffee cup, a splash of candle grease, a bed of begonias all Poirot required to display his now legendary powers of detection........

Replace a few words .. "Styles" by Office of the Secy,where who knows what is being planned, "Sharks" by Reliance who may be waiting to pounce, "Security" by Trust which is no longer there, impending evil by .... well impending evil nothing less.

Further to our last post on "The Nexus of Corruption- Reliance and Govt" here is some eye-opener news items our people could dig up from the web from this link:-
http://www.indianexpress.com/news/samajwadi-party-suspects-ril-hand-in-new-oil-secy-selection/352984/

Samajwadi Party suspects RIL hand in new oil secy selection

New Delhi, August 24: Samajwadi Party leader Amar Singh has asked the Government to cancel the appointment of R S Pandey as petroleum secretary, saying there was a “suspicious” role of Reliance Industries chief Mukesh Ambani in the crucial appointment. In a letter addressed to Prime Minister Manmohan Singh, the Samajwadi Party general secretary has said that Pandey’s appointment “should be cancelled forthwith”. The Prime Minister has sent a reply acknowledging the party’s letter.

Incidentally, Pandey’s appointment came just before former petroleum secretary M S Srinivasan retirement on July 31. The SP leader had then alleged that Srinivasan was showing favouritism to RIL and had demanded a CBI probe. Noting that Pandey’s appointment reflects “the unholy influence of one of the biggest industrial houses in the appointments of key government officials,” Singh, in his letter dated July 29, expressed concern on the “unexpected haste and suspicious co-incidental meetings” between the RIL chairman and Pandey before his appointment as petroleum secretary. Singh quoted media reports that said that Ambani met Pandey, just a day before his appointment, in a meeting facilitated by Minister of State for Steel Jatin Prasada.

Besides this, 24-hours after his appointment, petroleum minister Murli Deora himself hosted a tripartite meeting in his house between Pandey and Ambani, Singh said. Singh has also expressed his concern that these meetings send “wrong signals overall reflecting a suspicious nexus leading maybe to even favouritism to select players”.

With ENS inputs

Letter to Editors of Newspapers by Aggrieved Officers

Dear Editors

First, we thank on behalf of all the PSU oilfield officers for bringing out the real facts behind the oil strike recently by some newspapers. It was a moment of grief and deep disappointment when we were called ‘Deshdrohis’, ‘Traitors’, ‘Blackmailers’, etc.

Sir, officers of Oil PSU's are not goondas, gang leaders, anti-social elements or terrorists to take the country for ransom. They are all educated, responsible and dedicated officers of the most profit making and fortune 500 companies. It is very easy to enact ESMA and threaten an upright middle class man who went through the right procedures before going on strike in our democratic country. Officers and their families are deeply disturbed, demoralised and demotivated by the actions of the government and the media.

We definitely feel there is a bigger conspiracy and some vested interest to tarnish the image of these profit making Navratna PSU's. These are world class companies providing huge revenue to the goverment and subsidies to the common public.
IS THIS THE RIGHT PATH TO PRIVATIZATION?

Here are some of the recent government actions to ponder

1. Reliance had closed its petrol pumps due to crude oil price, no ESMA or nor they are deshdrohis.
2. Private air-liners like JET and KingFisher had stopped flights few months back, government had financially bailed out for 3 to 6 months time for repayment of ATF charges. (& that too at the cost of PSU oil companies who were asked to extend credit when we all know that the Oil Cos are losing money due to high crude prices)
3. JET airways had sacked its employees, government and political parties intervened to stop them from such actions.
4. Satyam carried out 7000 crores fraud and government plans to bail out with financial aids.

However if an oil psu worker goes on strike as a last resort after repeated failure of talks and inaction from government officials for more than 2 years, then he is a Deshdrohi, Traitor, Blackmailer…etc.

India is a great democracy with a liberalized economy and visionary leaders like our Prime Minister, dismantling APM in Oil sector and providing opportunities for private sector to explore our country for oil & gas through NELP. In this competitive environment, PSU’s are no more charity organizations nor are the employees working for charity. These Oil PSU's have to compete with private companies like Reliance, BG, Shell, Cairn Energy..etc. To compete you need good performance, and for good performance you need motivated working employees and officers. Many experienced and talented officers have left these PSU's and joined Reliance and other Pvt companies because they provide better pay and facilitites. It is this attrition which led to the demands to save the Oil PSU's from becoming sick units.

Its was quite surprising how media had misinformed the general public by reporting that junior officers had a starting pay of Rs One Lakh. An experienced Oil PSU employee gets below Rs.50000/- even after rendering 10 – 15 years of service. Moreover, it is quite illogical to compare the salaries of high court judges with PSU officers. Can we compare the powers, authority and status of judges, collectors or defence officers to a PSU officer, who is an ordinary citizen by status. Oil PSU officers did not ask salaries comparable to the IT industry which is very highly paid. Demand was only to compete with private oil players like Reliance, reduce attrition and prevent national oil companies becoming sick units. I quote the former MoP&NG Mr. Mani Shanker Aiyer " If you pay peanuts, only monkeys will be left in ONGC."

It was quite heart-breaking to listen to the media calling our officers ‘Deshdrohis’, ‘Traitors’, ‘Blackmailers’, etc. Media was totally biased and hijacked by the government with the help of private oil players and vested interests. Media outright rejected to report the officers view and demanded huge amounts in several lakhs of rupees to air and present the real facts. A corrupt media will lead a nation to disaster.

OSOA did not go on strike overnight, they put their demands long back, had informed the government ministry about resentment in the pay revision package. Oil companies had several meetings with management and govt. officials past two years, had carried out dharnas, hunger strike, work to rule, etc before issuing strike notice when all talks and promises failed. Even the strike dates were defered for various reasons, what was the govt. and the petroleum ministry doing all this time? Officers had resorted to strike after losing their patience due to the INACTION of Government officials. Why questions are not raised against these bureaucrats?

IS THIS THE RIGHT PATH TO PRIVATIZATION?
PLEASE SAVE OUR COMPANIES FROM BECOMING SICK UNITS.

Jai Hind

Sincere Officers (Names withheld to avoid draconian measures by Govt.)
OIL PSU

The Nexus of Corruption: Reliance and Government

There is a gnawing feeling in the minds of every OIL Men of the Public Sector why they kept on deferring the issue for two years and then pushed us into a strike and THEN by refusing to budge an inch and accept minimum legitimate demands their real intention was to show Oil PSUs in a bad light so as to pave the way to hand over the assets of the country to one power Private group. And we all know where power flows from ? The gun barrel or money?

See this link which seems to be talking of some nexus much earlier. We are of course not experts at commenting on national issues and neither should we be drawn into them. But friends let us read what some experts are already saying.

http://desicritics.org/2008/09/09/005819.php

Some excerpts from the website :-

Quote

The Nexus of Corruption: Reliance and Government
September 09, 2008C R Sridhar

A government, for protecting business only, is but a carcass, and soon falls by its own corruption and decay.’ - Amos Bronson Alcott, American Educator.

One of the common myths circulated in Indian mainstream media is about the inherent dynamism of the Private sector, which offers a refreshing contrast to the venal, corrupt and mendacious class of politicians and government officials. The Captains of Industries are sympathetically portrayed as dynamic, hard working and enterprising people who are thwarted by soul stifling regulation imposed by the Government. Unlike the moribund Public Sector, say the business friendly media, the Private Sector is efficient and creates a big pie in the economy. But unfortunately, like all myths, it has elements of truth but deceives us by not presenting the whole picture.

.................

One of the most remarkable books to emerge in the Indian publishing scene in recent times is Reliance- The Real Natwar written by Arun K. Agrawal.

.......

The spotlight of the book is on the alleged involvement of Reliance Petroleum Limited (RPL) in the Iraq oil-for-food scam. As the author says in his book,

‘This book has its origin, in the compulsion, born of exasperation, experienced by the author to record the failure- or, more accurately, the self-serving refusal – of the Indian political and administrative system to investigate the award of extremely lucrative oil contracts under the United Nations- administered Oil- for-Food programme in Iraq to RPL in transactions manifestly driven by kickbacks/ bribery and bipartisan political patronage.’

...................... Tip of the iceberg: The Oil for Food scam was not an isolated instance of Reliance Petroleum Limited walking away from corruption unscathed. There are also other scandals involving the Reliance Group. One of which was the deal involving Panna-Mukta- oil fields - given to Reliance during the Congress government by Captain Satish Sharma who was the Minister of oil and Natural Gas and a close friend of Rajiv Gandhi.

............... A dangerous collusion:

When the interests of Big business coincide with the personal interests of politicians and bureaucrats of the government, then it can be safely assumed that public good or national interest would be in an irreversible terminal decline. As Timothy P. Carney in his book The Big Rip-off: How Big Business and Big Government Steal Your Money says,

‘Today's largest corporations have mastered the art of working with government officials at every level to stifle market competition. They reap billions through a complex web of higher taxes, stricter regulations, and shameless government handouts.’

Endquote

Need we say more? The truth is out there for all to see. It is time now for us to direct the attention to the real malady of the system.

Look Ahead- RS Pandey says

What do we think looking ahead means? This will be evident from some news items soon to come from the same media on of which is already appearing in the Hindu on 16th Jan'09 that Govt is thinking of Deregulating the Pricing Mechanism to help Private Players in Retail Business.

Press Cip1 Jan13

Publish at Scribd or explore others: Other eBooks oil sector

The Government is celebrating their “Success"

The Oil Strike is called off. The Government is celebrating their “Success”. The “Educated” Oil Sector Officers have “surrendered” in front of the Bureauocrat-Politician Nexus. Public sympathy is against the Oil Sector officer’s. Electronic Media is up-against the highly paid officers. But the saddest part is democracy is no where to be seen.

There are three issues to the whole fiasco. The first is the democracy. The law of justice says there should be equal opportunity for each side to put up their point, in front of all. But there was total dark of the “Other side of the story”. The media never bothered to get those views. The Officer’s Association was not allowed to move freely in the democratic country with the arrest looming large on their heads. They couldn’t come to the public with the fact about what their demand was and how the strike has gone out of their hand? For how long they were demanding in front of ministers and beurocrats together and for how many times they were betrayed by these ministers, backing off from their promises. The “Khoji Patrakarita” was no where to be seen. Ministers were giving full media coverage with their mis-representation of the facts. No view was even sought from the officer’s community.

The second issue is “who created the crisis”? Can the educated mass of this country, “willingly”, put the country on ransom?. Even in the wildest imagination of their dreams, they could not have thought that the strike will continue for more than three hours, as they were convinced that the PM of the democratic country will immediately hear their point of view and some solution will definitely come to the crisis. That too this was their last resort, after pleading with the government for last two year or so. But Petroleum secretary and the petroleum minister managed the show, such that the matter reached PM only when every thing was out of control. No body will have the sympathy towards a cause when public is facing such crisis. The political parties certainly will not have. This was the precise calculated strategy of the petroleum secretary and the ministry. But the most disheartening part is the role of electronic media who highlighted the issues only when everything was out of hand of everybody. Ministry has given the assurance of “Essar” and “Reliance” coming for the rescue when need be. Where were they? They are the fellows who closed their petrol pumps when Crude prices were rocketing high, as high as 147$ a barrel, and selling petrol in the country was only a loss making proposition. They diverted all their products to export to gain the profit rather than sustaining the loss but serving the country. They agreed to come for the rescue when their stocks are piled up, as the crude prices are too low now and their product prices are not competitive in the international market. So they eyed their opportunity in the crisis, if the same could be created. They connived with the ministry to create this crisis. But in absence of their marketing network they could not succeed to sell their piled up products, although they were successful in creating the crisis. Now they are eying for privatization of some of the assets of these PSUs so that they can use the same at no additional costs. Government could have used the repressive tactics right on the day one when they were not talking to the officer’s community. But they waited for the crisis to be created. Now reliance is telling they went away because they were not subsidized by the government. They are making the country fool once again. Governemnt doesn’t subsidise the petroleum products but it is the PSU who directly borne these subsidies.

The third issue is “what were the demands of Oil sector Officers”? At present they are classified as A1 group of public sectors, who have many autonomies with regards to their pay and perks. Justice Mohan Rao Committee, which was set up to recommend the pay structure for the new pay revision, has also re-instated the said categorization of A1 companies. All Navratna “Companies” were in this category. While recommending the pay revision for public sectors, DPE abolished this A1 category. So now IOC was also to get the same salary as HEC or Balmer Lawrie. With this, officers in many grades in oil sectors were to get less salary, after revision, from what they are getting up till now. This is because the pay revision was being effective from Jan’07 and many perks were going to be reduced as their percentage is much lesser in the A category in comparison to earlier (and proposed on Justice Rao Committee also) A1 category. The main demand of the Oil Sector Officers was to reinstate the A1 categories to these public sectors. The work ethics and the working environment in Oil sector is not same as in other sectors. They are still profitable and able to sustain the competition of private players like Essar and Reliance because of this only. The risk of life is also too high in these companies. The recent accident at Reliance Refinery at Jamnagar is testimony of the same where three engineers have died in the recent blast of compressor. The similar accidents have earlier taken place at Panipat Refinery and Digboi Refinery with too many casualties. To be competitive in the current market, the oil sector employees work for more than twelve hours, almost daily, sacrificing their social and personal lives. In return definitely they want a better salary and perks than others. The Justice Rao committee has proposed a “Risk Pay” component also to the salary. But the government had abolished the same.

If you analyse the present pay structure, all the scales have an upper slab. Whenever any revision takes place, the salary touches the higher slab, irrespective of grades. Thus the stagnation starts to occur within a year. Justice Rao Committee had proposed the removal of such upper slabs from the salary structure. DPE had not removed these upper slabs in their recommendations. They had also not indicated whether they will consider the stagnation pay or personal pay while calculating the revised basic pay or not. All the revision was with periodicity of ten years and the Oil sector officers was demanding these to be of five years considering the present volatile market conditions. These were the main demands, which were not being accepted by the government for last one year. Even the individual management were of the view that what DPE has proposed in a minuscule hike in the salary and they were also partially in support of the Oil Sector Officers agitation, till the government used their whips and force, by calculated manipulation of public sympathy in their support and creating the crisis by purposefully not talking to the agitating officers and creating the panic in the public with the help of electronic media like Aaj Tak, and Star News, who clearly proved to be a saleable commodity.

The present propaganda of an entry level officer getting more than a lakh per month is again a one sided propaganda. They want to say the Oil sector executives are getting more than 12 lakhs per Annum. Even the best offers in IIIMs are not more than Rs 10 Lakh per year on CTC basis. Then why the IIM graduates are not joining the companies like IOC and ONGC, instead they are going for MNC s and other private companies with such a lesser salary. Why the attrition rate is too high in Oil sector PSUs. The fact is that the monthly take home salary of an entry level A grade officer is hardly twenty to twenty five thousand. And contrary to the present industrial trend an officer in E grade (Four grades higher than the entry level officer) is getting only Thirty to thirty five thousand of rupees. Even if one adds every tangible and non-tangible facilities, this salary could not go above Rs One lakh. But the newspaper and electronic media is showing the things other wise.

The fact is Oil Sector officers are a responsible educated lot of this country, who do not know how to manipulate the things and who have never thought of manipulating the things in this democratic country. The only fault they did was to adopt the path shown by our great leaders like Mahatman Gandhi and Jawaharlal Nehru to go on strike if your legitimate demands are not being heard in a democratic country. They forgot that this is not the same country. The Political Goondaism is much-much above the gentleman’s approach. As they could not bear the fear of getting sacked from their well earned jobs, they succumbed to the goondaism of Political establishment. They cannot take the path of confrontism. They cannot imagine of being inside a lockup, leave aside the jail. They couldn’t see the country men accusing them for the oil crises. They could not digest being presented as Villain of the society. So they chose to call-off the strike and start the work so peacefully, as if nothing has happened. They understood the fact that democracy is only for the name sake. In this country, without abiding by the wills of the politicians they cannot even survive as only The Mighty have Powers, Media and public sympathy in this country, not the bare Fifty thousand odd educated officers who toils hard through out their life to serve this nation day-in and day out and come no where in the vote bank politics of the politicians, as they vote by mind and not by heart. So they are finally defeated and called-off the strike.

Prasant

KUMAR, A. PRASANT" kumarap@iocl.co.in

Apathy of oil PSUs and their employees

Copy of msg posted at http://www.lkadvani.in/forum/viewtopic.php?f=11&t=1244&start=0#p2880#p2880 by gentleman below

by asif on Tue Jan 13, 2009 2:59 am

Dear friends,This is my first mail in the forum and it is regarding image tarnishing of oil sector PSU employees. The dragaonian attempt to sell the PSU and selfishness of the buearocrats. Above all the media had also some fixing with the government which is very bad for democracy. It is because of the selfishness and short sightedness of some people at the top of the power echelons that the energy sector may slipoff tp private the hands of indian government in near future. Some conspiracy is being hatched as is evident from the present political equations.

The Oil sector strike, which started so smoothly, had a very dramatic ending. Whole episode raised many question, most of it still remains unanswered. This episode had been clearly considered as “naak ki ladai” by the bureaucrats, who enjoy the upper echelon of power. With this article I just want to expose what happened behind the scene (as per my perception). The three angles to this quadrilateral (one being the OIL PSU’S officers) are 1) The bureaucrats / IAS lobby, 2) The Politicians 3) The Industrialists (i.e.The Ambanis).

It is true that we got a raw deal. The government sidelined The Rao committee report, which took 2 years to finalize the pay recommendations of oil PSU. Our new package was completed in just 4 lines & a pay band table. It was a complete rush-rush job. The IAS lobby is the most powerful lobby of this nation. Petroleum secretary, R. S. Pandey is one of the members of this lobby. The bureaucrats can never think of allowing any one to have a pay package, which is equivalent to them. Pay packages are considered as tool to ‘show off’ importance in the society. First it was the Army personals that demanded a better package, & then it was the Oil PSU officers. If they keep on giving similar pay packages then, next time someone else would ask for a higher salary. By crushing the ‘strike’ with iron fist, they shot two birds with one stone. First a higher salary was denied to these officers & a message was sent to all others. Media was used as a weapon to demoralize the strikers. The words ‘Deshdrohi’, ‘terrorist’ Oil Babus’ sent a clear message that something fishy was happening behind the scene. I have never seen such false propaganda warfare ever in my life. How can a entry-level executive having a basic salary of 12000 Rs have a salary of 1, 00,000 Rs per month. It seemed media deliberately did not even tried to check the ground reality.

There after Politicians come in the scene. While they welcome there own emoluments by thumping the table, forget about the others whose technological knowledge is making this nation an upcoming power. The only thing they consider about is their vote bank. The media portrayed a wrong picture. The victim was portrayed as the convict. If the media showed realty, pressure would have been on government to act in a sensible manner. At my personal level I don’t endorse ‘strike’. But strike is the only option left with any workforce after all the means is exhausted in a democracy. The situation is similar to the current scenario between India & Pakistan. Pakistani terrorist attack Mumbai, all diplomacy fails & India attacks Pakistan. Whole world media accuses India of it atrocity. India under pressure from UN backs off. If war is considered unethical, similar is ‘Strike’. But you have to use it because nothing is left to do. 55,000 members may be insignificant to be considered as ‘Vote Bank’, but consider this as they contribute to 15% of the GDP. We are the one who bears the subsidy burden, so that a millionaire in his BMW doesn’t have to pay extra.

The appointment of Petroleum Secretary, R.S.Pandey has a very interesting story. After CPM left the coalition UPA government due to Nuclear deal, Congress took the support of SP on the condition that Petroleum ministry is given to them. The deal was settled with the appointment of Pandey as Petroleum Secretary, who is a representative of SP. Petroleum Ministry is considered as great source of revenue for party fund. Irony of the situation is that Anil Ambani is in SP. Mr. Panedy is the same person who travel executive class by air, stays in grand Hyaat, & given chauffer driven car, the bills to which are paid by ONGC. It is a known fact that Hon. Petroleum Minister Mr. Murli Deora is a family friend of Mukesh Ambani. Last but not the least comes in the picture are industrialist like Ambani brothers. Reliance Industry Ltd is a competitor of ONGC in the OIL & GAS industry. If salary of the employees of PSU Oil sector were increased, they would be forced to keep competitive salary in RIL. Because then only it would be possible for them to drain the best brain from ONGC. A whole lot of conspiracy is going on. ONGC spent 500 crores of rupees to develop the Panna Mukta & tapti oil & gas field, then also it was sold to Enron & Reliance in 1994. Whole deal was marred with controversy with accusation of kickbacks received by then Petroleum Ministry headed by Satish Sharma. Even a CBI inquiry was called in this matter.When ENRON got bankrupt, even ONGC made bid to take back their own field. But ENRON was hell-bent not to give the field back to ONGC. Finally the field was given to BG. These ‘goras’ showed their true color even after 50 yrs of independence. There are even other cases when ONGC fields were given to private parties.

What I mean to say is that after such repressive measures taken by Government & such a bad pay package, ONGC employees are bound to get demoralized. A demoralized workforce cannot give the best of their performance. Attrition rate would drastically increase, all being absorbed by the private players. Running an Oil & Gas field requires a lot nos. of technically sound people with years of experience. Attrition is going on at all level of employees. ONGC would then become a training ground for young executives. The performance of the company would get drastically reduced. Government would take this as an opportunity to sell the fields to private players like Reliance. The same employees who had left ONGC would work at the same place, but under Reliance. This is going to happen soon as the fields operated by ONGC have already crossed their plateau period. Now tell me “WHO IS DESHDROHI”.ONGC is working for energy security of the nation. It is buying assets all over the world. It is now a global name; it requires a well-experienced & talented workforce.

For that it has to have a competitive salary for its employees. ONGC is meant to serve the nation, not make profits. Last year it absorbed the subsidy burden of 22,000 crs so that petrol & diesel prices don’t go up. Amount given to exchequer was 31,000 crs , profit 17,000 crs. Then also spending in form of emoluments for employees were around 1% of total sales. These are same employees who work in mid sea away from their family, work under scorching heat in deserts, works in the chilling cold in the during the winter night , works under threats of terrorists. You can just imagine a situation when wind speed goes up to 50 knots in the monsoon at offshore. For every drop of Oil that is produced we profusely sweat. We are the true Patriots “DESHBHAKT”. WE ARE ONGC. Jai Hind.

After 50 years of independence we see powerful PSU only because of the far sightedness of the leaders of 50-60s. With the passage of time the people in the present government have forgot the ideology of those leaders and are trying to jolt the foundation of the PSUs. I had always voted for them since i had given the franchisee but I am giving a second thought now.Hope somebody will rise on the occasion to improve the present apathy.

asif
asif
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Joined: Sun Jan 11, 2009 9:42 pm