AUCTION OF OIL FIELDS - CORRUPTION, ILLEGALITY AND ASSAM

Assam is witnessing mass protests and effigy burning of the month old Chief Minister Mr. Sonowal over his toothless stand on the privatisation of the 12 oil fields in Assam. Ironically, he once fought with the people of Assam for 'Tez Dim Tel Nidiu' (will give blood, not oil).

The supporters of Privatisation say that the protestors are ignorant and have no concrete reasons to protest. They are just wasting time and hampering development and creation of jobs.

I am however grateful that Assam has taken a stand on behalf of the whole country and has stood strong as an example to protect the country and its natural wealth from corruption and selfish capitalism.

Right from Govt. forcing ONGC to take the 450 billion dollar loan from World Bank in 1991 with the condition that oil fields have to be opened up to global private capital (when they could have easily raised capital instead); the controversial Panna-Mukta oilfields in Bombay High given to the Reliance-Enron consortium for a paltry 12 crores; false declaration of its actual potential, after ONGC had spent 7000 crores in getting that geological data etc (even Petroleum Minister Satish Sharma allegedly took 4 crores, ONGC top boss was involved); ONGC CMD S L Khosla joining Reliance after allegedly disclosing all 'work programme' through the then Director Mr. Ravi Bastia (who too joined Reliance) about ONGC's data about Krishna-Godavari basin. (Read the book - Gas Wars); allegations that one OIL CMD was directly involved in the giving out of Kharshang oil field to private ENI Group / Jubilant Group; to the disqualification of the auctioning of 214 coal blocks from 1993 to 2009 by the top judiciary in 2014 saying that "the entire exercise of allocation through screening committee route thus appears to suffer from the vice of arbitrariness and not following any objective criteria in determining as to who is to be selected or who is not to be selected."; it makes it evidently clear that the natural resources of India is in DANGER from selfish capitalist and corrupt officials/public servants/politicians (perhaps to fund elections). 

The supposedly learned are saying that OIL and ONGC have said that they can't operate these oil fields because of lack of technical expertise and that the fields are too small for big players. The Petroleum Minister said, “Many of the big oil sector companies do not have the technology or managerial skills to exploit small oilfields and so we are allowing firms that have the technology and skill to bid for them”. 

There is no truth in such statements. Can he produce the document certifying the first right of refusal by OIL and ONGC? One must read the editorial by an OIL employee today in Pratidin dated 11th July 2016. He says, 'there is an attempt to belittle the navratna OIL and maharatna ONGC with these false allegations'. He says, 'there is not a single instance that he knows when work has stopped due to lack of funds or technical expertise or infrastructure'. He further adds, 'when OIL has invested in exploration, excavation and even transportation of OIL/Gas from Sorojoni, baruahnagar, Dipling, Merem, Duwarmora and Jeraipathar, there is no question that OIL will now not be willing to do the only remaining work of taking out OIL/Gas' (and leave that to the private companies).

Guwahati-based political commentator and economic analyst Adip Kumar Phukan says, “That argument is wrong. OIL couldn’t work in the Jeraipathar field because of local resistance. The government failed to assure people about the safety of the Rohmoria embankment near the field. However, OIL is still extracting oil from Sorojoni”. 

Also, who says that companies eager to bid are small companies? The second biggest group of Korea, ENI Group etc are not small companies in any parameter. 

IS IT EVEN LEGAL?

With the various acts like the Coal Mines Nationalisation Act of 1973, Oil Field (Regulation and Development) Act of 1948, Petroleum and Natural Gas Rules of 1959, Petroleum and Minerals Pipeline Act of 1962, the citizens of India had given the authority to the central Government to become 'trustee' of the resources so that the resources are not used for commercial purposes, so that the resources are only used for the common welfare of the society without commercial baggages. The Govt. cannot become the AUCTIONEER of the property. They do not have the right to sell or lease the property of the people to a private entity. 

In his petition to the Court regarding the Coal allocation, advocate Sanjay Parikh had referred to the 39th article of the constitution which says the Govt of the people is only responsible for the natural resources and therefore cannot be the auctioneer of the same.

The Supreme Court in its judgement relating to Coal Allocation has pointed out that 'The Coal Mine Nationalisation Act and further amendments in 1976 do not allow PSUs to mine coal for commercial use. The auctioning processes has therefore blatantly defeated the legislative policy in the Act'., and hence giving it to private companies may be termed as illegal.

This worry and the other concerns are evident in the emotions of the wide scale protests in the streets of Assam. Unless there is transparency, white papers being circulated in the public, we the citizens have to protest against such Govt. actions that may be detrimental to the welfare of the common people at large.

Protests are specially required when our minister Mr. Pradhan blatantly brags about Rs. 4000 crores coming to Assam's economy and not explaining how. It is specially required when there is public knowledge of corruption getting into the system of privatisation. It is specially required when there is no concrete reason the state cannot do the same work that a private company can.

When we have made acts that natural resources should not exploited for commercial reasons, the State can therefore exploit the natural resources by undertaking losses if needed be, for the common good of the people in providing electricity and employment. The funny question is why would there be losses, when private companies are so eager about these fields.

Lastly, Assam wont be left behind if these Oil fields are not privatized and in fact India will learn a lesson or two from Assam being a forefront leader in terms of opposing corruption and anti-national exploitation of natural resources. There are hundred other industries where private capital can bring in a change in Assam, namely Food Processing, Fisheries and Muga/Edi Silk.. 

Why are Governments so anti-national? 

Regionalism is about being conscious, responsible and taking ownership.

If I exclaim, "I love Assam", it may sound jingoistic, but it is actually about being conscious, responsible and taking ownership of Assam in my personal and social capacity.

In one of my FB post which said, "Oil India Limited is a Navratna PSU with its operational headquarters in Duliajan, Assam. It pumps out crude oil of Assam. In 2013-14, it paid Rs. 1786 crs to Assam state exchequer whereas it paid more than double, Rs 4154 crs to the Central Govt. Is that acceptable?", I had received two comments which prompted me to write this blog piece.

One comment read, "Yes it is. Did the state govt. provide any logistical or administrative support to the organization when required? apart from staging protests and halting the functionality of the organization for week thereby contributing to the loss of the company and nation at large, what is the role of the state? the company is only sought when the state requires money for any event or institution. what about all other CSR activities? Resources are always a property of the nation, not state. This regional approach is never justified. I have a single question, what is the state contribution for upliftment of the company till date?"

The other comment read, "Lets put it in a different region. Mumbai pays more income tax than any other region in India. Does it make sense that it has dirtiest streets, narrowest roads?"

Let me take this discussion in points to create a context for the debate and for easy understanding of what I would like to convey. 

1st Point

History is written; and policies are made or influenced by the powerful and the rich. To be powerful and rich, there are external and internal factors. Let me define external factors as location, resources, climate etc and luck. Let internal factors be the people, its culture, its traditions and traits. 

It is pure luck that Gujarat, West Bengal, Maharashtra etc had external factors like ports (sea face) which led to intense social and business interactions that normally leads to development. It is pure luck for Bengal that British decided to make Calcutta the Capital of India for 150 years and developed a small fishing village into a bustling city. In a letter to the Earl of Crewe, Secretary of State for India, Hardinge pointed out that it has "long been recognized to be a serious anomaly that the British governed India from Calcutta, located on the eastern extremity of its Indian possessions." Similarly, it was fate that they shifted the capital to Delhi and which made North India the political power centre after the Independence of India. 

In contrast, it was bad luck that Burmese army plundered, looted, killed and raped Assamese women at a time when the 600 year old Ahom Kingdom was at its weakest point. According to Hindu mythology, 12 years is a 'Yug'. Assam had the most tragic and destructive yug between 1814-1826. It was a period of complete mayhem and destruction of not only properties but the confidence of the Assamese people. Assam had become a land of corpse - a massive funeral ground. The population in 1826 was less than one-third of the population in 1766. The confidence was further shattered by the Britishers bringing in large population of Bengali officers. The official language of Assam became Bengali for around 4 to 5 decades. To make matters worse, Assam and the NE became part of Indian Union after independence, and it effectively made Assam a remote part of India in one far corner next to China. Geographically it became challenged in terms of the power centre being in Delhi. The confidence that broke during the dark 'yug' was further trampled during the British rule. It never got the chance to rebuild in the Independent India.

Lot of us blame the internal factors like lack of leaders, lazy character, 'kekura mentality' etc. for the current state of Assam, and we don't bother to look at the external factors and history. 

To cut it short, Assam has gone through tremendous tough times, and it will take at least a few more decades to come back to track. Effectively and obviously therefore, history and policies are not written in favour of the people of Assam. There are umpteen instances of exploitative decisions and non-decisions that have continuously pushed Assam backwards. Be it the tea industry which had the auction centre in Calcutta, the Oil industry which supplied sweet crude to Barauni refinery, the non-existing petrochemical industry inspite of being the first region to discover crude oil, the education sector which could establish only 25 institutes when Andhra Pradesh could establish over 800 institutes, the fisheries industry which imports fish when we are ourselves rich in water bodies and the agriculture sector which has failed to leverage the tropical climate of Assam that produces joha rice, different citrus fruits and many other export friendly crops.

2nd Point

Depression is a vicious cycle, as we have seen in the Great Depression of 1930s. Lack of growth leads to lack of opportunities which leads to lack of growth. Lack of opportunities lead to a lot of socio-political and economic evils. Extremism and 'chanda' culture are two of those evils. If Assam had a petro-chemical economy, or an industry in every small town, we wont have had those two evils. 

Even popular media acts as a stimulant to depression. It thrives on negative news. Instead of analyzing the reason behind the closure of the BigBazaar store in Tinsukia, it will declare that the reason is excessive ransom and 'chanda'. I wonder if Assam knows that Big Bazaar stores were shut at Bangalore, Kharghar, Sangli, Ujjain, Pune, Kolkata, Gwalior, Jabalpur, Indore and Ludhiana, along with the Tinsukia store in the same year. Kolkata is a small high volume trading hub and everything under the sun is already available in near whole-sale prices in walkable distances. It is like one mega Big Bazaar. Big Bazaar therefore couldn't offer any solid reason - USP for its existence.

Corruption is another bi-product of depression. Any region with signs of depression has debilitating corruption. There are lot of factors in a depressed economy which leads to corrupt ways to benefit for livelihood. 

So, it is crucial that we understand that Assam is going through depressionary forces and we all have lot of responsibility while loving Assam.

3rd Point

The development and livelihood of a village or a set of villages with common traits (or Assam) depends on the natural resources in the region, the skills required to utilize the same natural resources. Trading of those goods and services with other regions and villages comes later. Secondly, the environmental and social impact of utilizing natural resources directly falls on the community around the natural resource. Therefore, it has been debated and agreed in various forums that the ownership of natural resources is with the community and the people living in the region where the natural resource is present, and not with the state. 

Although there is no comprehensive legislation in the Indian constitution defining natural resources and its protection, the Supreme Court on its 2G spectrum case said, "Natural resources belong to the people but the state legally owns them on behalf of its people".

Legality is nothing but some rules made by the people with decision making powers and hence can be changed. Across the globe, a similar stand is maintained that natural resources belong to the community, and decision making should be decentralized. So the first right of use and of benefit of natural resources should lie with the community. The taxes and revenues should primarily go to the state government. We may in fact think about community level administrative units and budgeting conditions where the primary benefit goes back to the bank accounts of the communities which have natural resources.

Let me give an exploitative instance to prove how important it is to have ownership and knowledge about our own natural resources. In 1948, the centre sold a metric tonne of Assam's crude oil at Rs. 1382/-, of which Assam received Rs. 61/- only as royalty. As taxes, the central government received Rs. 532 and gave Assam Rs. 131 out of it !!

4th Point

Oil India Ltd. is a Navratna PSU and the Government of India owns 68% of the shared capital. Owning it constitutionally is the only contribution of the central Government. It is a Navratna because of its employees and the location of its operations. Nano plant could not survive in West Bengal, but Oil India has flourished in Duliajan, Assam. The state Government has no role to play, or to contribute apart from giving land and have a favored policy environment. Both these functions are being done by the state without hassle. OIL is not a charity organization for whom Assam state government should have a budget allocation. Also, there is no logic in saying that the state stages protests! The protests, if any are staged by various labour unions and other socio-political organizations which the state machinery helps control and mitigate. It is not a unique phenomenon in Assam, as is evident from the Nano example.

In terms of community work, every company has a budget for community work. Even private companies like TATA and Mahindra have a budget for CSR work. So OIL providing for its community is a mandated budgetary provision applicable to all companies. It is irrespective of where the company is located. So the standard of living in and around Duliajan, Bongaigaon, Numaligarh etc. are better than the other parts in Assam. Imagine if Assam had more such industries... if Assam had at least, enough refineries to refine its own crude oil production?

5th Point

I am too tiny to really worry about Mumbai whether it has development spends commensurate with its tax contributions to the central government. The small fact is that the Bombay Municipality budget is around 28000 crores and perhaps the highest in the country for any municipality.

My major worry is the polarized development centered around Mumbai and the metros creating a devastating brain drain from the other states of the country. The present day brain drain from Assam to these metros is perhaps more devastating the Burmese plunder and British rule. The Brits created industries, jobs and an economy in Assam that brought in migrant labours to Assam, primarily the Bengali and the Maruwari population. For sure, the qualified local Assamese also got benefitted then. Today, the trend is reversed. There is no job creation that is happening in Assam anymore. Many public sector undertakings have closed down, and private enterprises are too few and far between.

6th Point

If British rulers could see opportunities in Assam, why can't we? They created a cash crop (tea) and two mineral industries (coal and oil). It is been almost 7 decades that we have not created another cash crop, another industry, another trade opportunity. For instance, Assam is considered the home of citrus fruits and especially robab tenga (pomello) and can easily become an export hub. Assam can be a bamboo hub, a rice hub, a food processing hub, a tourism hub and many more such hubs. But we are a far away state in one remote corner invisible to the central government for development. So it is obvious that we are being exploited of whatever industries British had shown the potential for. Over two-thirds of the Assam's oil production was refined outside of the state, depriving the state of crores of rupees as revenues and taxes. Natural gas is one of the bi-product of oil exploration and Britishers had not developed any industry to use this natural gas. Quite obviously the central government has also not cared to develop any use of the same. As per 1992-93 data, 56% of the natural gas was flared off. We wasted over Rs. 30 lakhs worth of natural gas everyday.

Conclusion

Enough has been written about exploitation of inconsequential states like Assam by the Central Govt. and there is no guarantee that exploitation wont continue in the Modi regime. There is a huge task for every Assamese and for everyone who love Assam. The first responsibility is to read Assam's history and Assam's wealth to understand the current state of affairs without really referring to popular media. The second responsibility is to share the knowledge and help Assam know the real problems. The third responsibility is to try to find solutions in our individual capacities.

Regionalism is not about secessionist agenda. Regionalism is about being aware of our region, its people, its natural resources, its skills, its culture and is about a passion and dedication to help develop the region.

Let us all love Assam and bring back its glory days in the world map. One day, Assam will be a developed state known in the world politics and economy.