What next after 2G and the coal scam? The Damgate

These days, one of India’s favourite topics of discussion is about ‘gates’. We had the massive 2Ggate, then the Adarshgate and of course the Coalgate (and even an Oregate in Goa and Karnataka).

One should be grateful to the controller and auditor general of India (CAG) for having opened these ‘gates’ as well as the incredulous eyes of the Indian public.

Unfortunately, India does not like to conduct prospective studies of what the future could have in store for us. This is true for strategic studies (who will be India’s enemy, if any, in 2030?), but also in other fields, such as economy.

What about corruption?
This disease has dramatically worsened over the past few decades. The political system is such that money is needed to “democratically” win the next elections and money can only be easily obtained by running mega contracts.

I am not Nostradamus, but I can predict that the next “gate” will be the Damgate; for the simple reason that “Dams mean money”.

The CAG has timidly started to look into the issue; it has already discovered that the Arunachal Pradesh government has taken away four hydropower projects from the original allottee and given them away to private firms. According to the CAG, six projects were allotted to the NHPC, a government undertaking in 2000. However, between 2006 and 2010, Itanagar decided to offer them to private parties. The CAG report said: “Transparency and competitiveness in allotment of hydropower projects, as envisaged in the hydro policies of the GOI, were thus overlooked.”

In August 2009, an Inter-ministerial Group (IMG) was constituted by the ministry of water resources under the supervision of the PMO “to evolve a suitable framework to guide and accelerate the development of hydropower in the northeast region”.

The above mentioned six projects were to produce 20,700 MW of power; it was part of a plan to build a network of dams in Arunachal which would generate 63,300 MW. This was based on an assessment of hydro-power potential of country prepared by the Central Electricity Authority in 1987.

On April 29, 2012, The Hindustan Times asserted: “The Arunachal government seems hell-bent on building the controversial network of 168 dams. From 2005 to January 2012, the Arunachal Pradesh government collected Rs 1,333 crore as upfront premium and processing fees. The amount were paid by different private companies engaged in building a controversial network of dams in the hilly state.”

‘Upfront premium’ is a one-time non-refundable fee to be paid by a prospective power contractor; it is not included in the cost of the project.

Some 160 memorandums of understanding (MoU) were signed between the Arunachal government and the potential dam builders. It appears that even travel agents were “offered” MoUs.

Interestingly, a clause in the MoU absolves Itanagar of any responsibility: “The state government shall not be responsible in any manner for any losses arising out of the force majeure situation such as earthquake, flood, fire, external invasion, civil commotion; landslide, etc.”

Who will then be responsible?
Considering that Arunachal is a high-risk zone for earthquakes, it is rather strange, but it is easy money for the government and obviously a promise of other rich dividends for the ‘builders’.

Moreover, a group of respected environmentalists believes that the CAG has prepared an “extremely weak, inadequate non-audit” report.

In a press statement issued on September 3, 2012, the environmentalists commented: “The audit fails to raise many of the fundamental issues related to the hydropower projects.” Several worrying environmental issues seem to have been forgotten. The statement concluded: “We are therefore forced to reach the unfortunate conclusion that this CAG audit is highly inadequate, misleading and devoid of any attention to the basic issues.”

Several other issues are at stake. Take the example of the Nyamjang Chu 780 MW Hydroelectric Power Project (HEP) in Tawang district.

An environmental impact assessment (EIA) study of the proposed HEP has been conducted; it fails to mention the endangered black-necked cranes which annually visit Ziminthang, the diversion site of the project. Environmentalists and local people have raised objections to the report, but to no avail.

Further, the reservoir is located at the most strategic location of the country. It is in Ziminthang that the Chinese first attacked India 50 years ago; the McMahon line crosses in the vicinity of the proposed dam. Nobody seems to realise that bringing thousands of migrant workers to this area is also a security risk.

Though no complaint has been received from Bhutan so far, the power station is located only a few kilometers north of border.

Another important point: This ‘blue’ (or ‘gold’) rush creates a precedent for the Chinese to go ahead and build more dams on the upper reaches of the Brahmaputra, the Yarlung Tsangpo in Tibet. This issue is always overlooked.

Today, as the ‘gates’ of coal maybe closing down due the inquisitive CAG (and media) scrutiny, the politicians have to find new ‘gates’.

The Damgate is an easy one; Arunachal is so far away...

The author is a French-born journalist and writer