In politics, you are under public scrutiny: Naveen Jindal
Naveen Jindal, industrialist-cum-politician, made headlines for alleging blackmail by a TV media house. At 42, the chairman of Jindal Steel & Power is in his second term in the Lok Sabha. In an interview with Jyoti Mukul & Sudheer Pal Singh, minutes before he was entering the board meeting for finalising second quarter results last week, he defends his record and says controversies created due to recent government audit reports are not in the nation’s best interest. Edited excerpts:
After a spate of adverse media reports, you got back with an exposé on Zee. How justified is this?
I believe news channels get a licence for news and not extortion. Zee’s conduct has shamed most media houses. I was shocked at the way they have resorted to targeting us to extort money. They demanded Rs 100 crore, which is why they ran a malicious campaign. As a last resort, we took legal recourse by filing civil and criminal complaints. We will make every possible move legally to bring out the truth.
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Even shareholders have brought some embarrassment by questioning your salary.
Too much is being read into the salary package. It is pettyminded to talk on others’ salaries. There are many instances where promoters are given much higher remuneration and commissions, up to five per cent of net profits. Our company has given only two per cent commission.
Since JSPL is a listed company, shareholders can always question.
The norms allow me to take up to five per cent of net profit as commission and I get only two. It is approved by the board and shareholders in the annual general meet. Everything is relative. The board will decide if it will be raised or reduced.
Has your image as an industrialist and a politician suffered because of the controversies?
JSPL has strong fundamentals and these will not impact its image. JSPL has been awarded and recognised globally for performance, efficiency and shareholder value. We have various mega-steel/power projects under various stages of implementation in Odisha, Jharkhand and Chhattisgarh. The total investment planned on these is a little more than Rs 130,000 crore.
We are on the right path. Image can be good one day and not so good the next. My conscience is important for me. I try to do the best job possible. My conscience is absolutely clear as a politician, an MP and an industrialist, by following the rules of the land.
Will you make a mental distinction between a politician and a chairman of a company when you enter the board meeting?
We all wear different hats every day at different points of the day. When I wear the hat of a chairman, I take decisions accordingly and in the best interest of our business. We follow good corporate governance norms. As an MP, I am dedicated to my constituency.
A significant portion of the profit has come from the sale of power produced from coal blocks given by the government but sold in the open market.
We have played by the rule.
The Ramchandi coal block was allotted to you for a coal-to-liquefaction project in February 2009, just days before the model code of conduct for general elections came into effect.
The allocation was approved by the Inter-Ministerial Group (IMG) appointed for this purpose. A presentation was made to the IMG on October 1, 2008. It is a coincidence the approval letter was issued a few days before the notification of the model code of conduct. Sometimes, the government takes time to do procedural things.
But doesn’t being a politician help in getting work done from government agencies?
If one is in politics, you are bound to be under public scrutiny and people like to target you. Which other industrialist has come into active politics and joined the Lok Sabha? If it made so much business sense, then more industrialists would have joined the Lok Sabha.
Besides JSPL, RPower has also been in the dock for being allowed to use surplus coal from the block allotted for its Sasan power plant. Do you think it is correct for the government to take such a decision when fuel is precious?
If the government has decided in its wisdom to allow them, then it must be fair.
Would you say the policy of allocation of captive blocks was correct?
The coal allocation policy the government is following since 1993 is the best in the world. Which other country expects you to invest billions of dollars in further value addition of coal? Countries like the US, Australia, Indonesia and Canada, which produce coal, do not put a condition that you have to invest downstream. All these countries are happy if you mine and pay royalty and income tax. We should be grateful to the government that you cannot sell coal but set up power, steel and cement plants or feed the existing plants, which means lots of investment generation and a lot more employment.
If it was so, why did the Comptroller and Auditor General of India put a figure of more than Rs 2-lakh-crore loss to the exchequer?
I do not agree with the figures of CAG. It is most unfortunate this kind of controversy has been created. It has not been in the best interest of the country.
If the government policy is challenged every time, and companies made the subject of criticism, they will wonder whether to invest. If the media resort to sensationalism, it does not help.
Is it difficult for companies dependent on natural resources to operate in the country?
I feel it is extremely challenging to start mining projects in areas where coal blocks have been allotted to private sector companies. It is also challenging to set up large plants. There are issues of land acquisition, rehabilitation and resettlement and getting statutory clearances. These are difficult and time-consuming.