Political spat ensues over withdrawal of incentives to IOCL’s Paradip refinery

Bhubaneswar: After the Odisha government informed that it has withdrawn interest-free loans to Indian Oil Corporation Limited’s (IOCL) Paradip Refinery project, political bickering ensued with the ruling-BJD claiming to be safeguarding the interest of State while the BJP’s state unit alleged that the state government’s intolerance towards Union Petroleum ministry, Dharmendra Pradhan.

The withdrawal of incentives to the project has once again brought the Central and the State government at loggerheads. Senior BJD leader and minister Damodar Rout defended the State government’s decision citing that IOCL violated the terms of the agreement.

“IOCL violated the terms and conditions of the MoU. The State government felt that there is no use of giving them moratorium. I don’t see any legal discrepancies in the decision,” said Rout.

However, the BJP trained its guns on the State government accusing it of not being able to tolerate Dharmendra Pradhan, who is the union petroleum minister.

“The decision of the State government is not acceptable to the youths, industrialists and the people who love Odisha. It is the biggest investment in Odisha and there is also a scope of expansion in future. This decision is not in interest of the State and is targeted to  Dharmendra Pradhan,” said BJP spokesperson, Sajjan Sharma.

On the other hand, the Congress took a rather neutral stance after Leader of opposition, Narasingh Mishra stated, “If the State is not being able to get any benefits in return for incentives provided to IOCL, then the decision to withdraw the incentives is right. If the people of Odisha will benefit from any incentives provided to IOCL, then the decision is wrong.”

The State government reasons that the Paradip refinery project became operational 6-7 years behind schedule. Moreover, IOCL had unilaterally increased the capacity of the refinery to 15 million tonne per annum from 9 million tonne per annum. As per the State government, because of the delay in getting the project operational, there will be a revenue loss of Rs 22,745 crore on account of providing interest-free loans.

Also Read: Odisha withdraws interest-free loans to IOCL’s Paradeep refinery

On the other hand, a letter sent on January 17, 2017 from IOCL informed the Odisha Finance department secretary that as per the terms of the MoU the capacity of the refinery could be increased when required. Another intimation regarding capacity increase was sent to on  March 30, 2006. Moreover, the IOCL authorities also informed the State government, “Adverse law and order situation resulting into interruption of construction works by various unions at site was unprecedented and resulted into significant man-months loss.”