India may let power project deal pass<\/p>\n
By Clarence Fernandez<\/p>\n
BOMBAY (Reuter): Differences between the rightwing Hindu
\nparties ruling India's richest state may enable the country's
\nlargest power project to squeak through despite threats to scrap
\nit, political analysts and newspaper editorials said last Friday.<\/p>\n
The two parties rode local opposition to the $920 million
\nproject at Dabhol on Maharashtra's west coast to win power in
\nMarch on promises to review the contract between the state-run
\nelectricity board and the Enron Corporation, the U.S. company
\nbuilding the plant.<\/p>\n
Newspaper editorials last Friday said the Maharashtra state
\ngovernment was seeking a way out of the Enron tangle with its
\ndecision to place the review report before the legislature,
\nscheduled to reconvene on July 5, instead of deciding
\nimmediately.<\/p>\n
A legislative endorsement of the venture, The Times of India
\nsaid, would provide a face-saving device for the coalition of the
\nnational opposition Bharatiya Janata Party (BJP) and the regional
\nShiv Sena.<\/p>\n
This was a likely outcome, the newspaper said, since not all
\nthe Shiv Sena-BJP legislators are against the project, and only
\nthose from the coastal region were vocal in their opposition.<\/p>\n
\"The alliance can claim that even though it was keen on
\nfulfilling its election promise, it was helpless in the face of
\nthe legislature's endorsement of the venture. The rejection of
\nthe report will not necessarily mean a defeat of the government,\"
\nit said.<\/p>\n
The opposition Congress Party could vote with the Shiv Sena to
\nallow the project to go ahead, perhaps with modifications,
\nanalysts said.<\/p>\n
Maharashtra Chief Minister Manohar Joshi, visiting the United
\nStates to reassure investors of his government's commitment to
\neconomic reforms program, said on Thursday it would take only a
\nweek to make a decision on the report of the review committee.<\/p>\n
The review of Enron's contract, which critics say sets too
\nhigh a price for the power the plant will generate, was
\noriginally due in May.<\/p>\n
Analysts say the one-month delay granted to the review
\ncommittee indicates a tussle between the BJP and the Shiv Sena.<\/p>\n
\"Obviously the BJP wants the Enron project scrapped because it
\nis looking at the national elections,\" an analyst with a Bombay
\ninvestment firm said. General elections are due by next May.<\/p>\n
\"But the Sena, the real party in power and taking all the
\ndecisions, has realized it has drastic ramifications,\" he added.<\/p>\n
Recent U.S. and British appeals that scrapping the Enron
\nproject would jeopardize foreign investment were angrily
\ncondemned by Indian opposition parties as interference.<\/p>\n
The project is seen as a test case for the success of the
\neconomic reforms launched by the nationally ruling Congress
\ngovernment of Prime Minister P.V. Narasimha Rao.<\/p>\n
While the BJP has spearheaded opposition to the project, the
\nShiv Sena is seen to be veering to the view that the project
\nmight be acceptable with certain modifications.<\/p>\n
An editorial last week in the Shiv Sena newspaper, Saamna
\n(Confrontation), said scrapping Enron would not be a solution to
\nthe problem.<\/p>\n
But, the article said, to permit it to go ahead would be a
\nbetrayal of the people of the west coast, who protest that the
\nproject will endanger their farming and fishing livelihood.<\/p>\n
\"A third alternative must be found,\" the editorial said, but
\noffered no solutions.<\/p>\n
The Times said political expediency had prompted Joshi's move
\nto call a vote in the state assembly.<\/p>\n
\"Clearly the BJP-Shiv Sena government has boxed itself into a
\ncorner by adopting heroic postures in opposition which it finds
\nit cannot reasonably sustain in government,\" the newspaper said.<\/p>",
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