Naveen Jindal on tenterhooks in coal mine scam

Naveen Jindal on tenterhooks in coal mine scam

New Delhi: On Monday, June 1, industrialist-politician Naveen Jindal will get to know whether he will have to exchange his extravagant lifestyle for the dubious comforts of a jail cell for a three-year term, the sentence he would face if found guilty in the coal mine scam.

Former Congress Member of Parliament, Jindal, who is chairman of Jindal Steel & Power (JSP), is one of several industrialists that constructed empires around a government policy launched in 1993 to give away rights to coal deposits.

The idea was that private businesses would do a better job developing the mines than state-run enterprises. This, in turn, would boost supply of coal to power plants under pressure to generate more electricity. Jindal received more of the gratis coal than any other company, winning rights to 10 mines of the 218 handed out.

A Delhi court in September had ordered all the companies that received free mines to pay a levy of INR295 ($4.60) a tonne for the coal they had extracted. Jindal got the biggest bill of INR19.10bn, after paying which his company reported a net loss of INR12.80bn for the financial year 2014-15 — its first loss in the last ten years.

According to an interim report from the court last month, Jindal used his role as member of the Congress Party to gain control of a coal block in Jharkhand. In return, he is alleged to have promised the state’s chief minister Madhu Koda political support for the latter’s coalition government to remain in power.

JSP claimed on May 22 that it was confident of a positive outcome in the court case. The company, however, did not respond to multiple requests by phone and e-mail for answers to certain knotty questions on the coal mine issue.

Shirish Nadkarni

Shirish Nadkarni is a management consultant and freelance international journalist, who has been writing on all spheres of Indian business for the past three decades for a number of reputed overseas publications. An avid sportsman, Nadkarni has represented India in international veterans' badminton since 1997, and was the 55+ age group doubles world champion in 2005.

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