Lavalin shameful deal,party lost face: Ex-PB member wrote to Karat

A letter written by E Balanandan,a former member of the CPM politburo who died last month,on the controversial SNC Lavalin deal is now haunting the party....

Written by Express News Service | Thiruvananthapuram/new Delhi | Published: February 7, 2009 12:58 am

A letter written by E Balanandan,a former member of the CPM politburo who died last month,on the controversial SNC Lavalin deal is now haunting the party. Balanandan,who headed the party’s trade union,CITU,and a Kerala government-appointed panel on power reforms,had written to CPM General Secretary Prakash Karat on August 8,2005 that the party “had lost its face over the deal.”

“We committed a grave mistake. Our party has lost its face. The deal with SNC Lavalin was not only a wrong decision,but the manner in which it was inked and the project implemented was an insult to the normal procedures in this regard. This deal would spoil the party and trigger a revolt within,” he said.

The letter is published in the latest issue of Janasakthi,a magazine brought out by former CPM members,purged from the party.

The CPM has described the CBI’s move to prosecute Pinarayi Vijayan,the state party chief,in the SNC Lavalin case as “politically motivated” while Kerala Chief Minister V S Achuthanandan has distanced himself from the party line.

Vijayan was the state power minister when the government signed a deal with the Canadian company to get new plants for hydel projects in the state. When Balanandan wrote the letter to Karat,the state vigilance department had not even completed the probe into the case. The CBI took over the probe much later.

The party could have legally come out of this “shameful deal” and thus saved its face and protected the interest of the state,he said,detailing the irregularities in the deal. Balanandan,however,had not named anyone in the letter.

When contacted,Karat refused to comment. “I don’t talk about things that have a dishonest motive,” he said. His Politburo colleague S Ramachandran Pillai said: “I am not aware of it and I have no idea about this particular letter.”

The issues Balanandan raised in his letter were:

*The MoU route was wrong. There had been no proper contract to ensure that the grant promised by SNC Lavalin reached Malabar Cancer Centre.

*The renovation contract was given to the foreign firm,disregarding BHEL which was ready to take up the work for Rs 105 crore. The deal with Lavalin had cost the government Rs 374.5 crore.

*It is wrong to say that the Left government could not walk out of the deal initiated by the Congress-led government. As per Clause 13 of the consultancy pact signed by the Congress government on 24 February,1996,the actual deal would come into effect only when certain conditions were honoured.

Balanandan said that the final deal was signed 10 days after his committee had submitted its report to the government. The panel had advised the government against the deal.

“Lavalin escaped,but our party lost its face,” Balanandan concluded the letter requesting the party chief to look into the matter. Exactly a month later,he wrote another letter to Karat, detailing the technical flaws of the deal and the project.

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