Monday, October 31, 2011

[rti4empowerment] manmohan says this is the right time to fight corruption

 


28 Oct 2011

RAJAT GUPTA WAS PM'S BLUE-EYED BOY

From Our Delhi Bureau

NEW DELHI: Prime Minister Manmohan Singh may have to answer many questions on special favours showered over the years on Rajat Gupta, the 62-year old poster boy of Wall Street success arrested in New York on criminal charges of leaking inside corporate information and out on the bail bond of US $10 million.

Because of the patronage of the PM, Rajat Gupta, an India-born American citizen, has turned out in the past couple of years as one feted and wooed by the high and mighty in India and given land at throwaway or rather no price for his projects all over India, be it in Andhra Pradesh, Gujarat, Orissa or Punjab while the foreign firms engage him for the influence he pedals in the government circles that matter.

As a Kolkata daily noted, it is surprising and disturbing to note the Prime Minister's support to Gupta's multifarious activities in India, throwing open the PMO, Yojana Bhawan, Health Ministry and Human Resources Development Ministry to a man who is now facing criminal charges in the United States.

In July 2006, the Prime Minister convened a meeting of the Cabinet Committee on Economic Affairs and sanctioned a one-time grant of Rs 65 crores to him to launch the Public Health Foundation of India (PHFI) and gave it another 36.15 crores in the 2007-08 budget without any explanation.

The PHFI has received more than Rs 100 crores in this manner from the Centre and much more from the state governments and no one knows how the money is spent as neither the government nor its private partners cared to publish any report on its finances. Despite running with the government funds, it does not submit to the Right to Information (RTI) Act nor open to audit by the Comptroller and Auditor General (CAG).

Then PM's principal secretary T Kutty Aiyappan Nair, who is now his adviser, is among four senior bureaucrats appointed on the governing board of PHFI at the time of sanction of the first grant in 2006 while Planning Commission deputy chairman Montek Singh Ahluwalia is also on its advisory board. Gupta, son of a former Ananda Bazar Patrika journalist and former director of Goldman Sachs and Procter and Gamble, is chairman of the foundation.

BUSINESS SCHOOL: Another outfit of Gupta promoted by the PM is the Indian School of Business (ISB), hailing it as a "centre of excellence" and shutting eyes to the hefty money he has been collecting as fees while claiming it to be one of his philanthropic activities.

Dr Manmohan Singh persuaded the Punjab Government to acquire 70 acres of prime land worth Rs 105 crores from farmers in Mohali and give it to the school at a token rate of Re 1 per acre on 99 years of lease. The ISB website says it plans to enroll 280 students at the Mohali branch in 2012.

TELECOM SECTOR: A $1.4 billion New Silk Route (NSR), a firm started by Gupta to focus investments in India with Raj Rajaratnam sentenced to 11 years' jail for inside trading with his help, secured a licence for broadband wireless services in Madhya Pradesh in June last year through its subsidiary Augere Mauritius. One of the founding partners of the firm is Pakistan finance minister Abdul Hafeez and the firm is also involved in a score of schools in Pakistan run by the family of former foreign minister Khurshid Mahmud Kasun.

The power Gupta wields in the corridors of power in Delhi is such that nobody in the Home Ministry raised any questions on the deal despite the fact that Augere also provides the broadband internet services in Islamabad, Rawalpindi, Lahore and Karachi. Objections were, however, raised by the ministry when Etisalat, a UAE based firm, acquired majority stake in Swan Telecom on the ground of national security since the company had considerable presence in Pakistan's telecom sector.

RUSSIAN BANK: It was because of Gupta's proximity to Dr Manmohan Singh that Sberbank, Russia's largest state-run bank, inducted him on its board as the first and only foreigner to be so appointed at five times the salary of its Russian directors, to use his good offices for entering the Indian banking sector. It got the Reserve Bank of India's clearance to open a full service branch in Delhi in August 2009. Since then, Gupta is retained as a strategic adviser, just in case his influence pedalling is needed again.

He acquired 260 acres of prime land in Hyderabad from the Andhra Pradesh Government for his Indian School of Business (ISB), which has not been able to utilise more than 80 acres in its decade-old existence. The school attracted 560 students for its post-graduate programme in 2010-11 academic year, charging Rs 20 lakhs each. Its short-term executive education courses draw hundreds of candidates and fetches crores of rupees.

UNRECOGNISED COURSES: Because of the PM's backing, nobody questions Gupta's PHFI offering unrecognised health courses that are not approved by any statutory regulator, be it the Medical Council of India or All India Council of Technical Education (AICTE). And, on the top of it, the state governments have been paying Rs 2.5 lakh per candidate for its employees to undertake its one-year post-graduate diploma courses.

There are no entrance tests for the courses PHFI runs as admissions are strictly on the basis of letters of recommendation. It admits that it is not an accredited institution and
none of its courses are recognised or accredited. The Health Ministry, however, continues to recognise its role in the recast of India's healthcare system.

The foundation is set up under public-private partnership (PPP) model and goes around asking the state governments to partner it to set up its institutes by giving it a minimum of 40 acres of land free of cost and bear 20 to 50 per cent of the project cost of Rs 140 crores.

Among the states that have fallen for such institutes include the Andhra Pradesh government which has allotted it 43 acres of land and paid Rs 30 crores, the Gujarat Government which has allotted it 50 acres of land in Gandhinagar and given the grant of Rs 25 crores while the Orissa government has provided it 40 acres of land near Bhubaneshwar.

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note. man mohan's daughter is a lawyer in USA

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