Debu Bhattacharya, Managing Director, Hindalco, discusses the CBI case against his company. By Chaitanya Kalbag 

Hindalco Industries Ltd.’s Managing Director, Debu Bhattacharya, says that had he known how complex and fraught the process would be to set up an alumina plant and a smelter in Orissa, he would have never put it up. 

“I really don’t understand where we went wrong. If anything, we have been at the receiving end,” says Bhattacharya. The CBI has registered a case against former Coal Secretary P.C. Parakh and Aditya Birla Group Chairman Kumar Mangalam Birla under the Prevention of Corruption Act in connection with the allocation, in 2005, of the Talabira II and III coal blocks to Hindalco. 

“When there is a coal block available, people are invited over the Internet to the site of the Ministry of Coal, and various companies apply. Whoever comes first gets certain brownie points. Indal was the first one off the block. I have not seen that application. I had no say in that,” says Bhattacharya. Hindalco acquired Indal, the Indian subsidiary of Canadian aluminium major Alcan, in 2000. 

Four years earlier, Indal had applied for the Talabira II coal block. A screening committee’s decision was made in January 2005. “After we acquired Indal in 2000, we continued to pursue that,” he adds. “Now I know from various sources that Neyveli Lignite Corporation got it.” 

“On April 8, 2005, we signed a Memorandum of Understanding with the Orissa government to put up our project,” says Bhattacharya. The government of Chief Minister Naveen Patnaik undertook to provide raw material, water, coal and electricity to the Aditya Alumina and Aluminium Project. “However, we were told that we had lost the mine. I went to Naveen Babu and asked if the state government would please take it up with the Center because we had been told we would get coal for the power plant.” 

“I understand that Patnaik wrote to the Coal Ministry. He told us, ‘Don’t just rely on my letter; you also follow up.” Now we come to Talabira III, which was given to Mahanadi Coalfields Ltd. [a subsidiary of Coal India]. What Parakh [then Secretary in the Coal Ministry] says is Talabira III; it was Talabira III; it was one rolling field. If you divide it into two distinct ownerships, there will be a wall, and you lose a lot of coal there- It could be 30 or 40 million tonnes. So the coal ministry for the first time said, ‘Why are you doing this, Hindustan Pakistan?   Why don’t you form a joint venture so that there will be no barrier?  And they gave it to the three of us, Mahanadi, Nyveli, and Hindalco.” 

Bhattacharya says that on November 10, 2005, based on the merits of the case, the joint venture was approved, with Mahanadi taking a 70 percent was a brilliant idea for the companies to have a joint venture because it also helped conserve coal for the country.” 

“We have followed every step in the book to get that allocation,” he adds. “Once we got the allocation, we went full steam to put up the project. To the best of my knowledge, Neyveli has not put one brick on the ground, and we have already invested ₹11,000-12,000 crore. The plant is up, and we are going to light up next week.”

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