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July 13, 2000
T V R Shenoy
Another instance of irresponsible politicians
Suresh Prabhu, Union minister for fertilisers, is commonly acknowledged to be one of the more efficient men in Indian politics. He comes from a background in industry which is rather unusual in this day and age. But with all his efficiency and experience, there are some legacies of the past that must make him throw up his hands in near despair.
One such rogue project is the Haldia Fertilizer Project of the Hindustan Fertilizer Corporation. In 21 years, this child of the taxpayers of India has not produced one, repeat one, single gram of fertilizer! But poor Suresh Prabhu is the man who must clear up the mess which the Congress and Third Front governments have fostered, or ignored, over the years.
The Haldia Project was conceived as far back as in 1971. (It was one of those idiotic public sector factories that were put up by Indira Gandhi as part of the effort to bolster her 'socialist' image.) The project was supposed to be completed by March 1976; in fact, the plant was not mechanically complete until 1979.
It borders on the farcical, but the plant could not begin operations even in 1979 because the West Bengal State Electricity Board could not supply any power to the plant! Of course, the Left Front was in power in the state which meant that industrial efficiency had started plunging.
After much paper had been pushed back and forth, a captive power plant was sanctioned. However, the Haldia Project did not start functioning even when this came up. Why not? There is a lengthy list of excuses. First, the soil survey to determine the precise requirement of the foundation had not been adequate. Second, a major revision in the design of the ammonia plant was found necessary. Third, attempts to indigenise equipment led to delays. Fourth, there were problems with the credit supply. And so on...
To cut a long story short, ultimately all concerned decided that trying to make the Haldia Fertilizer Project a going concern was a complete waste of time. Therefore, all commissioning activities were abruptly halted in October 1986 -- when the plant should have been functioning for ten years according to the original schedule!
However, neither the Congress nor the CPI-M, the two major parties in West Bengal for most of this period, wanted to be associated with a plant being closed. So half-hearted attempts to restart the project continued. It was found that rehabilitation of the project would require setting up a new ammonia/urea plant. But costs had gone up considerably since 1971 when the Indira Gandhi regime had cheerfully given the green signal; according to 1995 prices, it would have required at least Rs 910 crore to start all over again. So, in April 1995, it was decided to hive off or close the Haldia Project.
Quite predictably, the Congress and the Left Front have promised to oppose any attempt either to shut down the plant or to privatise it. I cannot think of any greater irresponsibility. These are precisely the two organisations that landed the whole project squarely in the soup. If one did not do its homework before sanctioning the project, the other winked at labour unrest and power outages. But Sonia Gandhi in her wisdom has decided to snub Dr Manmohan Singh and all that he stood for, while the Left Front is delighted to 'prove' its socialist credentials again. But does either group have any solutions of its own?
Permit me to recap the situation on the ground. The facts are brutally simple.
Fact One: The standing charges of the Haldia Fertilizer Project for the fiscal year 2000-2001 will be approximately Rs 14.68 crore.
Fact Two: An aggregate expenditure of Rs 1,418.10 crore (provisional) has been incurred on the project up to March 2000.
Fact Three: Despite the fact that not one grain of fertilizer has been produced to date, the total manpower on the project as of March 31, 2000 is 1,424.
It staggers the mind to learn that almost 1,500 people are being paid, at the taxpayers' expense, to do absolutely nothing. Nevertheless, both the Congress and the Left Front will fight tooth and nail to save the plant -- all for the sake of protecting their 'socialist' image! Can irresponsibility go further?
Jyoti Basu has no compunction in begging industrialists to come to West Bengal. Sonia Gandhi and the Congress boast of 'unshackling' the Indian economy. But when the time comes for hard decisions, both the Marxists and the Congress are content to offer nothing more productive than to scream in the streets.
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