Indian Oil will pick up 26 per cent stake unless the three existing promoters, the Bengal government, Purnendu Chatterjee and the Tatas, have an unexpected change of mind.

Bengal industry minister Nirupam Sen today met Indian Oil chairman M.A. Pathan and M.S. Ramachandran, director, projects and business development, at Union petroleum minister Ram Naik’s office in Delhi. Home minister L.K. Advani was there, too. It was not known why.

Indian Oil sources said: “We had given the proposal to the HPL board that we want to acquire 26 per cent. The Indian Oil board has taken a decision to invest in HPL. The offer went to them before August 31 when the HPL board met in Calcutta.”

Indian Oil is offering to buy 26 per cent at Rs 10 per share. “There is no question of paying a premium to HPL. Let the project be viable in the first place. The high-cost borrowings of the company have to be reduced immediately,” the sources said.

The paid-up equity of the project is Rs 1,010 crore and authorised share capital is Rs 2,000 crore. How Indian Oil will acquire the stake remains to be worked out. But it seems likely that the Bengal government’s stake will come down to accommodate the new partner.

Chatterjee was opposed to handing management control to Indian Oil and appears to have got his way for now. There could be some heartburn among the promoters at not receiving a premium but this is unlikely to result in a deadlock because of the gains accruing to both sides from the deal.

Indian Oil will get an assured and a large customer for naphtha in HPL once it enters the project. Haldia Petro, on the other hand, cannot get lenders to lower the interest rate that is hobbling its viability without the credit rating Indian Oil commands.

What could still cause some more rounds of hard bargaining is the price at which HPL buys naphtha from Indian Oil. With naphtha price dipping in the world market, HPL would want to knock it down.

Indian Oil sources dismissed reports of differences between the two sides over HPL’s valuation as exaggerated. “Media reports have said IOC has valued the project much lower than what HPL projected. The truth is that we have asked HPL to lower the cost of the project to a little below Rs 5,000 crore. But HPL insisted that the project cost is higher than Rs 5,000 crore,” they said.

The Bengal government wanted a firm commitment from Indian Oil about its participation before the HPL promoters met the lenders tomorrow.

Tarun Tejpal, Tehelka CEO and editor-in-chief, said he had received a letter from the filmstar. Bachchan was quoted as having written that since his own company, AB Corp, was planning an initial public offering to raise capital from the market, his fund managers had advised him against continuing his association with another media company to avoid a conflict of interest.

The news that a director of Tehelka had quit was made public in a dramatic fashion by television anchor Rajat Sharma at a seminar this evening on Tehelka tapes: sleaze or journalism, organised by Roli Books. Sharma had made it clear that he did not agree with Tehelka’s methods of uncovering defencegate. “Can you say that you have the support of your directors?” Sharma asked Tejpal.

Tejpal replied: “I know what you are referring to and I am not hiding the fact that Mr Bachchan has wanted to resign. But it has nothing to do with Operation West End.” He later said Bachchan had outlined the reasons for his resignation. “In fact, he has offered help when we need it,” he said.

The executive directors on Tehelka’s board include Shankar Sharma of First Global, apart from Tejpal himself.

Last week, the Centre had filed an affidavit with the Justice Venkataswami Commission, probing the Tehelka newsbreak, in which it alleged that the website had ulterior motives like manipulating the capital markets and driving stock prices down.

Consider this: the circle realised a revenue of Rs 285 crore in the financial year 2000-2001; the same year, its unrealised-revenue figure stood at more than Rs 91 crore. BSNL’s corporate future is, at the best, very bleak when the ratio of unrealised revenue and bills realised stands at 1:3, admit officials.

They, however, are not surprised at the turn of things. A department which takes more than two years to decide on the future of a software that has revenue-collection as one of its important aspects cannot be expected to do any better, they say.

The department of telecommunication had earmarked Rs 70 crore for developing IT in the West Bengal circle for a five-year period starting from 1998.

Of the Rs 70 crore, Rs 40 crore was devoted to the implementation of Dotsoft, a DoT-developed software which, among other things, helps in billing matters. The same software is now running successfully in Andhra Pradesh but has not been implemented in West Bengal till date.

A meeting was held at Telephone Bhavan in mid-1999 to decide on the implementation of Dotsoft. Chaired by adviser (technology) to DoT N.P. Dhomania, it was decided that the pilot project would start in Durgapur by August 1999.

The reality, however, is different. The circle has been dependent on the Coimbatore Package for billing matters, despite “inherent drawbacks”, because of the non-implementation of Dotsoft.

The circle is now going to implement the Trichur Package for billing consumers, and officials are hopeful it will plug the gaping holes in the revenue-collection net.

An internal audit carried out by the department, however, gives no reasons for such optimism. The audit found a “huge discrepancy” in the number of telephone connections and the actual number of bills sent.

One example would be enough to show why the circle has uncollected bills worth more than Rs 91 crore. Till March last year, the Asansol division was found to be serving more than 43,000 subscribers. But the division billed only 39,000 subscribers, leaving 4,000 subscribers with practically free phones.

Glaring examples of non-billing abound. The department, as things stood on 31 March this year, was to get Rs 30 lakh from Reliance Telecom as arrears. But the firm was not to blame. The audit found that it was not billed at all.

Unaddressed bills in the Calcutta division have cost the department Rs 4.5 lakh but officials admit that the figures the audit got are the “tip of the iceberg”.

According to the audit, repeated instructions to send monthly bills to heavy callers have fallen on deaf ears and lists are not updated regularly.

“A high-level committee from New Delhi is due to arrive in Calcutta in a few days to discuss related matters,” deputy general manager (revenue) R.K. Pathak said, adding that he would not have anything to say on revenue-leak till the meeting was over.

As a first step, the government decided to set up a Cabinet committee on economic strategies, which will review the pace of work on mega projects and come up with a report within the next fortnight in an attempt to speed up the completion of these projects.

Vajpayee also announced that a group of ministers will be set up shortly to consider reforms in labour legislation.

It was also decided that the Cabinet secretary would hold a series of meetings with the secretaries of different ministries to ensure that the completion of these mega projects could be streamlined. He has been asked to submit a report in three to four weeks.

Vajpayee told the meeting that he would shortly consider the report of the Expenditure Reforms Commission on downsizing ministries. After a discussion with the ministries, appropriate steps will be taken in four weeks. The government has resolved to pare the bureaucracy by 3 per cent over the next two years.

“The Prime Minister has set the agenda for the government for the next six months,” finance minister Yashwant Sinha said after the three-and-a-half hour meet, where ministers dealing with the infrastructure sector gave a list of their investment projections. “This was a meeting where we tossed strategies to boost public spending, especially in areas like agriculture and agro-industries.”

But they are actually doing it. Not the second, the first. “Smile, don’t spit” is the command from the government. As far as commands go in China, this is a nice one and it’s working.

Having bid successfully for the 2008 Olympic Games, China is telling its people to keep the city clean and be friendly to foreigners. The message hasn’t gone into the spittoon. Pseeeek in public places has become a thing of the past in Beijing.

The Universiade — or a universal meet of universities from different parts of the world — is now being held in Beijing. Many looked on the event as a test of Beijing’s preparedness to hold the Olympics. Indications are this has been a success.

There are already 400 hotels — five and three star — in the capital. Three hundred more are planned to be built. Construction is booming.

Kill the spit, flash the smile isn’t the only instruction issued to citizens. There is a series of commandments, with the Olympics in mind. Taxi drivers, shop assistants and owners of stalls now take compulsory classes in spoken English every week.

Local people have been asked not to move around bare-bodied in public and not to litter the streets. Having won official sanction, smiling at capitalist foreigners isn’t a crime any more.

But Big Brother is watching. In the past, those who got too friendly with foreigners were frowned upon. Now, those that don’t get friendly are frowned upon.

With sunny smiles abounding, the Chinese capital, with its elegantly laid-out streets, its expressways and its glittering shops, looks attractive to foreigners.

More so as there’s something else on show. Capitalism seems alive and kicking but by another name: “socialism, with Chinese characteristics”.

Yes, it’s written in Chinese. Big Mac is here, but so is Armani. Mac is more popular than Mao — McDonald’s banners are all around. Mao looks lonely in the sole portrait at sprawling Tiananmen Square.

It’s still being debated how much China has deviated from the policies of Mao. With the economy growing at a steady 8 per cent every year, many today are even willing to credit Mao for its success, rather then Deng Xiao Ping.

“To me, Mao is a greater leader then Deng,” says a post-graduate student in Beijing. “Mao made some mistakes in his lifetime, but the reforms Deng later implemented were actually Mao’s.”

But for many young Chinese, the Communist Party, though still powerful, is not as attractive as it used to be. Many of them are not members of the party and they do not feel they are missing out.

“If you want to join the party, you have to cultivate the right people in the right places from very early on,” said a university student. “I’d rather pay attention to my career then be in the party.”

That, though, is not how the 65 million members of the Communist Party of China think.

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