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DPC papers: India seeks more time

September 16, 2004 17:08 IST

India has sought 60 more days from an arbitration tribunal at London to respond to a claim of about $6 billion as compensation from GE and Bechtel, the foreign promoters of now-defunct Dabhol Power project in Maharashtra.

Certain complications, ahead of the September 30 deadline for filing the affidavit by India before the tribunal, had developed as its British solicitor firm Evershed withdrew from the case saying it had earlier represented GE in another case.

Confirming the move, Attorney General Milon Banerjee brushed aside apprehensions expressed in certain quarters about the preparations by India to put up a strong defence in the arbitration case.

"Everything is under control. We have put an English counsel in place and our preparations to defend the case for India are going well," he told PTI.

Meanwhile, Som Mandal, chief of the Indian solicitor firm Fox and Mandal, which came into the picture after the new government took charge at the Centre, said he has already sent the communication to the tribunal, seeking more time.

"I have also spoken to the British solicitors Simpson, Thatcher and Barett, who represent GE and Bechtel," he said adding, "I am confident of getting more time to file our response."

GE and Bechtel, who joined the erstwhile Enron Corporation for promoting the first fast-track counter-guarantee project in Maharashtra, had filed the claim blaming India for not taking enough steps to prevent closure of the project resulting in a violation of the Indo-Mauritian Bilateral Investment Promotion Agreement.

Among the reasons cited by Fox and Mandal in its communication to the tribunal was the change of government at the Centre in May and the consequent change in the legal team, which was pursuing the matter.

Realising the sensitivity of the numerous arbitration claims, including the dispute over the invocation of the counter-guarantee of about Rs 1400 crores (Rs 14 billion) given by the Centre, filed by GE and Bechtel and other interested parties, the United Progressive Alliance government has constituted a Group of Ministers to deal with all matters relating to DPC.

Although, the finance ministry is actively handling the issues, Finance Minister P Chidambaram excused himself from handling any file on the issue, since he had appeared for GE and Bechtel before the Supreme Court.

Government is also looking into the possibility of any influence that GE and Bechtel could have exercised on the last minute withdrawal of British Solicitor firm Evershed, forcing the Indian side to search for a new one.

Mandal said he would be going to London next week to shortlist the new solicitor firms for representing the Indian government before the tribunal.
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