After Rs8,000 cr sales tax issue hit headlines, govt seems to be distancing itself from the group; it’s also not part of CM’s delegation to Japan.
Is the Narendra Modi-led Gujarat government trying to distance itself from Essar Group?
This definitely seems to be the case, particularly if you consider the fact that Essar is the only major corporate house that has been omitted from delegations traveling to different countries to promote the upcoming Vibrant Gujarat Summit, slated for January 2013, or chief minister Modi’s Japan visit later this month.
Four high-profile delegations, comprising senior government officials, representatives of leading business houses, and industry associations, have so far visited China, Europe, US, Canada, among other places to promote Vibrant Gujarat Summit and to attract investments to the state.
Essar, a leading player in energy, ports, steel and other businesses, though, has not been a part of any of these high-level delegations. One of the country’s biggest conglomerates is also not a part of the other delegations that are slated to travel to UK, Middle East, East Europe, and other places in the coming weeks.
A senior official said that Essar is also not a part of the official delegation accompanying chief minister Narendra Modi to Japan later this month.
Essar’s exclusion from the delegations is surprising to say the least, because Essar Group chairman Shashi Ruia is said to have very good relations with Modi. Ruia has been a vocal supporter of the CM, and has accompanied him on at-least half a dozen foreign tours in the past few years, most notably to Switzerland, South Korea and China in 2007 and Russia in 2009.
Jayesh Buch, executive director, Essar, had accompanied Modi on his China visit in November 2011. Buch has also been a part of delegations to promote earlier Vibrant Gujarat Summits.
Officials say there are reasons for the Modi government to distance itself from Essar, especially because of the manner in which the Group has acted in the Rs8,000-crore sales tax dues matter. The government also recently attached three bank accounts of Essar Energy to press for recovery of pending dues.
“The state government is not happy with Essar’s continuing defiance and delays in paying the sales tax dues. Essar’s omission from the delegations is a means to send a clear message to the Group’s bosses,” said a senior government official.
On its part, Essar says that it was invited to be a part of the Vibrant Gujarat promotion delegations.
“However, the company management and senior officials could not join the delegations due to other prior engagements,” said an Essar official.
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