Tags:
Journalism of Courage
The article 8216;The importance of being on PM8217;s advisory council8217; by Sucheta Dalal March 17, 2002 wreaks personal prejudice and is a tirade against our chairman and the Essar Group, leading us to believe that the writer has motives other than informing the readers perhaps sinister. Shashi Ruia8217;s contribution to the Indian industry needs no introduction. The industrial conglomerate he has built is in the much-needed infrastructure and core sectors. Ruia richly deserves the recognition from the government.
One need not to be erudite to know that the steel industry is on the downswing and Essar Steel is no exception. Essar steel was the first to export large quantities of steel to discerning markets in Europe and the US. The fact that the company continues to earn operating profits even in the present market scenario speaks volumes of the efficiency of the company. The steel prices have fallen from 370 in 1997 to 185 in 2001 and it is a well known fact that at this price, none of the new generation steel companies is able to cover the interest cost. Hence, casting any aspersion on Shashi Ruia for the ills of the industry is unfair.
8212; Jacob John K, Vice-President Corporate Communications Essar Group
Sucheta Dalal replies:
It is funny that Essar should accuse this writer of personal prejudice and 8216;sinister8217; motives. It is precisely to avoid this type of false allegation that the writer limited herself to quoting newspaper reports about the Essar Group. It cannot have escaped the company8217;s attention that most of these reports were published by newspapers other than those belonging to this group. Also, the decision by the S.S. Tarapore committee to investigate Unit Trust of India8217;s investments in the Essar Group surely have nothing to do with this writer8217;s alleged prejudice.
Further, not all of Essar8217;s problems can be attributed to the downturn of the steel industry. With regard to Essar8217;s exports, which are mentioned in the letter8212;isn8217;t it a fact that Indian financial institutions have been saddled with payments because of export guarantees provided to Essar, which have been encashed by the foreign lenders?
The article and its arguments are all based on Essar8217;s financial track-record and are self-explanatory. Investors who have lost heavily on their investments may not agree with the company8217;s self-assessment.
