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Union govt dangles counter-guarantee for Cogentrix

Power Minister P R Kumaramangalam on Thursday assured the Lok Sabha that the national government would give the counter-guarantee to the Cogentrix power project in Karnataka within a week, provided the state government complied with certain formalities.

The promoters of the 1000 mega-watt power project at the port city of Mangalore in southern Indian state of Karnataka, pulled out last week on grounds of inordinate delays in securing clearances from various governmental agencies.

Replying to a call attention motion in the lower house, the power minister said the government has been awaiting the Supreme Court judgement on a public interest litigation questioning the bonafides of the project.

Now that the court has cleared the project, the power ministry would take steps to give the counter-guarantee.

The minister said elaborate procedures for obtaining the counter-guarantee stipulated by the previous Congress government had ensured that not many private sector projects, barring Enron, took off. The present government had reviewed the procedures, simplified them and enpowered state governments to enter into power purchase aggrements with private promoters under certain guidelines.

Kumaramangalam said the promoters of the project had not informed the power ministry about their decision to pull out and that he came to know of their move through press reports.

The minister said he had asked the officials of Cogentrix to reverse their decision and they had assured him that they would consult their board of directors before taking a final stand.

Referring to the members' charge that the power ministry did not move in the matter though the courts had not given a stay, the minister said the Karnataka high court had ordered that a First Information Report be registered by the Central Bureau of Investigation for various cognisable offences and that the central agency should inquire into the entire matter. Now that the Supreme Court has set aside the high court order, the power ministry will move in the matter, he added.

The minister also made it clear that there was no parallel between Enron and Cogentrix court case and that his ministry had no option but to await the orders of the apex court as far as the Karnataka project was concerned.

Earlier, three Congress members from Karnataka, S Bangarappa, C K Jaffer Sharief and R L Jalappa, criticised the national government for the inordinate delay in giving the counter-guarantee for the project and said the power ministry should expedite the project now that the Supreme Court had cleared all the objections.

UNI

Cogentrix sets terms for power project revival

Business

Karnataka