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How Coalgate Loot was Spent – 10 seater Bombardier Jets, $15 Million Apartments and Big Fat India Wedding

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India’s Brazen Crony Capitalism is nothing new to the Greenworldinvestor readers where we have time and again been highlighting how the unholy nexus of politician-businessmen have been looting the country dry.

We recently wrote how on the easiest way to become rich in India is by becoming a politician crony.

India is a country with one of the largest population of poor people living hand to mouth. But becoming super rich in this country is quite easy if you know how. All you have to do is become a political crony and start counting your millions if not billions. Corruption in India has become rampant with a scam being uncovered almost every day. Politicians and Businessmen have been jailed but they have managed to get out on bail using their millionaire lawyers to fake illness and other shenanigans. Some politicians are now involved in both professions with some rumored to be billionaires owning companies through surreptitious means and parking their money in Swiss banks. Business Groups in India see their shares rising and going down depending on which political party wins, proving the nexus between politicians and businessmen. There has been no reforms to separate these two and now powerful politico-business dynasties have started ruling large parts of India.

The recent exposure of the humongous coal mining scam further exposes the loot and plunder of India’s natural resources. According to one businessman there is no option but to indulge in this looting in order to survive.

Big Fat Indian Wedding

If you were in his position, you would do the same thing,” the businessman said, asking not to be identified because his company also received coal fields and did not want to draw attention to himself. “In this country, it’s difficult to survive. Whoever has a master key wants to eat up all of India. Whoever doesn’t have a key is struggling to survive.”

Mr. Jayaswal is building a large house in Nagpur and hosted his two children’s weddings in Phuket, an island in the south of Thailand. For his daughter’s wedding, Mr. Jayaswal flew in 350 friends, business associates and politicians for an event that was featured on the popular Indian television program “My Big Fat Indian Wedding”.

The 2G telecom scam had exposed many of the telecom and real estate tycoons as being nothing more than greasy middlemen who managed to make it big with their political connections and corruption. The Supreme Court had managed to get some of these politicians and businessmen into jails before they used their money power to get out.

Crony Capitalists in India

“DB Realty,one of the biggest beneficiaries of the Real Estate Boom in India now faces the music. This company has found itself in the center of the scam. It is charged with making hundreds of millions of dollars by buying a telecom license cheaply and flipping it for huge profits. With charges of this publicly listed firm having equity holdings from the mafia, DB Realty portrays the worst of India’s Crony Capitalism. The lines between India’s Politicians, Businessmen and Bureaucrats have been blurring. Even petty lobbyists like Nira Radia now command wealth measured in hundreds of crores. It remains to be seen how far the guilty are punished and whether the real ringleaders are brought to book. Note the 2G Telecom Scam has already implicated some of the biggest corporate houses of the country like Unitech, ADAG Group. Other big conglomerates like Videocon, Essar were also involved in winning the licenses.”

Coal Scam exposing different actors but outcome will be the same as forgotten 2G Scam

Just as the media focused on the corrupt in the 2G scam and conveniently forgot them after a new juicy scam came out, the same thing will happen again. Currently the media is bringing out monstrous corruption stories on the beneficiaries of the scam accused, but soon everything will be forgotten and the scamsters will be out of jail free.

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Abhijeet Group Prime Coalgate Beneficiary

10-seater Bombardier jet, a flat in Mumbai that costs Rs75 crore, daughter’s wedding bash in Phuket, real estate in Nagpur running into crores… Manoj Jayaswal, chairman of the controversial Abhijeet Group, sure lives life king-size.
Jayaswal’s leapfrog began after he got five coal blocks, but that would only be half the story.

His group leveraged the free booty by proposing power projects and got Rs22,000 crore of loans sanctioned from various banks. Of this, Rs11,000 crore has been disbursed with no project near commissioning, and that could be the beginning of bigger problems for lenders, said experts.

Monthly interest payments along with salary and administrative expenses run into huge sums, between Rs100 crore and Rs110 crore, for the Abhijeet group.

Marans of the Sun Group are the poster childs of Crony Capitalism in India

Sun TV is one of India’s largest media companies having interests in TV, Print and Cable Networks with a predominant focus in the southern state of Tamil Nadu. The stock used to trade at lofty valuations as it showed strong growth and margins year after year. The promoter of this company are the Marans who are nephews of Karunanidhi chief of the DMK regional political party. With close access to the levers of power, the company owners could manage to drive away the competition using extra judicial means as was seen in the case of Hathaway Cable. One of the Maran brothers is the Textile Minister of India and before that he was the Telecom Minister of India. However Sun TV has started tanking,   as the DMK which was ruling in Tamil Nadu lost the elections to the opposition recently. This has resulted in Sun TV coming under massive pressure, as the new government comes out all guns blazing. The AIDMK is proposing the nationalization of the cable TV network in the state which would lead to massive loss as it is a huge cash generator for Sun TV.

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Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to greensneha@yahoo.in or call me on +913340606492.

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