Bhubaneswar: In reply to the statements of Union Petroleum Minister Dharmendra Pradhan alleging the Odisha Government has violated the agreement signed in between Indian Oil Corporation Limited (IOCL) and the State, BJD spokesperson Pratap Keshari Deb on Sunday said the charges made by Pradhan as well as the facts presented by him are false while terming the Union Minister's statement given today as 'unfortunate'.
Deb said, “The MoU inked in 2004 is divided into two parts. Firstly, keeping in views of the non-viability of the project in 2004, the then Prime Minister and Chief Minister of Odisha decided to extend financial support to the project and make it viable. Besides, the agreement has provisions to provide financial support for construction and electricity to IOCL for the project.”
Deb added, “The project was to start in 2004 and end by 2009. Once the IOCL plant starts its production, the State Government had agreed to provide interest-free loan for 11 years. However, the IOCL company board delayed the production from the plant to 2009-10 as it passed the project in 2008-09.”
He further stated, “The IOCL project's commercial production started in 2015 only," adding that the State Government has not touched the second Article of the MoU yet.
Mentioning the State Government had raised objections against the IOCL refinery in 2011 Deb alleged the Union Minister is now mixing up the decision of Odisha to withdraw interest-free loans to the IOCL plant with the results of the recently held panchayat polls.
He said the Sanjeev Hota Committee in 2011 had suggested the State government to review the MoU citing huge financial loss for Odisha.
Also read: Odisha withdraws interest-free loans to IOCL’s Paradeep refinery
“The State Government on December 30, 2016 had taken a decision to send a show-cause notice to IOCL. On basis of the reply given by IOCL, the State Cabinet on February 22 took the decision to the withdraw interest-free loans. As currently IOCL is earning profit of nearly Rs 15,800 crores, there is no point for the odisha government to support IOCL on the viability ground,” said Deb.
Notably, earlier in the day, Pradhan had alleged the State Government of violation in the agreement with IOCL by withdrawing the interest-free loans.
Talking to newsmen, Pradhan said, "Discussions were held two to three years earlier than the Start of the project in 2009. However, now the Odisha Government is alleging IOCL has increased its capacity from nine million tonne to 15 million tonne unilaterally.”
He presented a letter saying, “The then Project Director of IOCL, Jaspal Singh, in March 30, 2006 had written a letter to then Chief Secretary of Odisha, Subash Pani, mentioning on the increase in the capacity. It was mentioned in the MoU signed in 2004 that IOCL can increase its capacity as per business assessment."
Also read: Political spat ensues over withdrawal of incentives to IOCL’s Paradip refinery
The Union Minister further said, "The State government had given the interest-free loan arrangement to IOCL on its own and had agreed the public sector company will return the amount with interest after 12 years.”
Alleging the BJD's anger against BJP for its surge in the Panchayat elections was the reason behind the State government's roll back of tax sops to IOCL's Paradip refinery, Pradhan added, "The BJD government should not harm the State's interest by withdrawing interest-free credit to IOCL due to its anger against BJP for its success in the Panchayat polls. The step will affect the flow of investment into the State.”
Also read: Odisha to lose over Rs 2,000 cr on tax deferment to IOCL
"The move will stall employment generation thereby hitting unemployed youths hard," said Pradhan that he would request the Chief Minister to refrain from taking such decisions.
The project was completed in 2015 due to reasons like delay in land acquisition, cyclones and law and order problems in the area as the BJD regime backtracked from its commitments, the Union Minister added.