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Shourie denies favouring Tatas in Air-India bid

Divestment Minister Arun Shourie has rejected the suggestion that the government has favoured Tatas in the Divestment process of Air-India.

The criticism of the government is based on misconceptions and misunderstanding of the guidelines approved by the Cabinet Committee on Divestment, he told reporters in New York.

He said no one has been disqualified and leading NRI businessmen, the Hindujas, would get a chance to explain their case. A decision would be taken only after their arguments have been considered, he added.

Shourie said originally, there were nine bidders but two were non-serious. Others dropped out for reasons that had nothing to do with Air-India.

Swiss Air, which would have been a good partner, suffered a loss of 1.8 billion dollars last year. Its chief executive was changed and the new incumbent said he wanted to put his own house in order first. In fact, they are divesting their own operations, Shourie said.

The minister said Delta-Air France would also have been an excellent alliance for Air-India as it would have helped expand to North and South America and Europe. But they could not find an Indian partner despite their attempts, he added.

Ultimately, Tatas and Hindujas were left in the field despite all efforts by the government, he said.

Then the question of regulatory authorities indicting several firms came up. The government felt it could not deal with them on a case-by-case basis as the process would have taken long.

Under these circumstances, Shourie said, it was decided there should be some general guidelines which were then finalised. But the process was still not complete.

The parties which prime facie fall foul of the guidelines would be given notices and asked to represent their case. Only after that would the government take a final decision, he added.

To a question, he said it was a misconception that under the guidelines, if a party was under investigation by a regulatory authority, it would be disqualified.

A party can be disqualified only if it has been indicted by a regulatory authority or a court on a crime so grave as it outrages the moral sense of the community.

"It is a misreading of guidelines to say that so many people have been disqualified," he said.

To a specific question whether Hindujas have been disqualified, Shourie said, "Not yet."

He said when he had read out the guidelines to the press, he was asked about its implications concerning specific parties. "Then I gave the view that prime facie, they fall afoul of particular guidelines. But then nobody can be disqualified till he is given a hearing."

He said the view was expressed as the guidelines say that if it is a national security related matter, then even if there is a chargesheet, that group cannot continue. In this case indictment is not necessary.

However, Hindujas could argue that the charges against them do not constitute a national security matter, Shourie sad.

"They may come back and say Ashok Leyland is different from the rest of Hinduja group. They can come back and say 'You have charged us - and we dispute that - with taking commission. That is not a national security matter'."

These arguments would be considered before a decision is taken, he added.

The guidelines are going to be published in two or three days and "then we will call these people for hearing," he said.

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'There is a general political consensus on divestment': Interview with Arun Shourie

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