Activist accuses Crisil of being hand-in-glove with Enron

FEBRUARY 6: Crisilâ€™s downgrading of Maharashtra government's rating in view of non-payment to Enron has kicked up a fre...

FEBRUARY 6: Crisilâ€™s downgrading of Maharashtra government’s rating in view of non-payment to Enron has kicked up a fresh controversy. Anti-Enron activists allege that the credit rating firm is hand in glove with the US-based power giant.

Pradyumna Kaul, convenor of the Enron Virodhi Andolan, today alleged that CRISIL had downgraded the state government at the behest of Enron to put pressure on the government. Crisil has committed a breach of trust and its chairman and MD Ravi Mohan should resign within 48 hours, he charged. “We have documents in support of our allegations and we will release the papers on Friday if he fails to resign,”Kaul said.

Crisil’s MD R Ravimohan described the allegations as absurd. “The downgrade was due to the default in payment of dues by the state government. We have nothing to do with the invocation of counter-guarantee by Enron,” he said.

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But the Enron Virodhi Andolan says it will file a criminal case against Crisil for breach of trust and also take up the matter with the Maharashtra Electricity Regulatory Commission. “It is our allegation that the timing of Crisil’s action was not an honest exercise as it came just 24 hours before Enron decided to invoke the Centre’s counter-gurantee,” he said. “It is obvious that Ravi Mohan and his board of directors are deeply involved in Enron episode,” he charged.

Kaul accused Crisil of “fooling the people and the Government of India” by claiming it had authored the Power Purchase Agreement (PPA) of Dabhol Power Company. “Our information is that, it was prepared at Houston in USA,” he said. “The Union Finane Minister must immediately revoke Crisil’s licence since it is involved in rating financial institutions in the country and people have trust in it, he demanded.

“We will not be surprised if other rating agencies, too, downgrade Maharashtra Government’s ratings since Enron has got wide influence,” he said.

Kaul also criticised Enron for invoking the counter-gurantee of the Central Government for, what he described as, a paltry sum of Rs 90 crore. “They should not have done it at a time when the Central Government is occupied with relief operations for quake victims in Gujarat,”he said.

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He also said that the Centre should not pay Rs 90 crore to the power company. “Let Enron approach the High Court for its dues and the court will definitely check all aspects of the PPA. The government can outrightly scrap the project wihtout paying a single paise if it succeeds in proving that the agreement was illegal,”he opined.

Meanwhile, state finance minister Jayant Patil expressed his unhappiness over Crisil’s action. “They acted in haste without consulting the state government,” he said.