|The Saradha ad issued before February 19, 2011
Sept. 1: A marriage of convenience between the Indian Railways then headed by Mamata Banerjee and the Saradha Group has blown the lid off an association whose seeds were sown when the winds of change had begun to blow across Bengal.
The deal — first reported by the Bengali daily Bartaman on Monday — essentially allowed Saradha to flaunt its ties with the Indian Railways and sell a tour package that Mamata announced but did not really take off.
Railway officials claimed that no rule was broken when Saradha was picked to promote Bharat Tirth, a 16-train service that offered low-budget travel, accommodation and food to pilgrims and covers pilgrim centres.
But the disclosure of the deal at a time the CBI is turning up the heat on the Saradha scandal is significant for a host of reasons.
One, the deal establishes a direct association between Saradha and a department that Mamata then headed.
Two, the deal dates back to 2010 — a milestone year when it was clear that the political climate in Bengal was changing. The year was significant for Saradha for another reason. In April 2010, the economic offences investigation cell of the Bengal government, then run by the Left, had informed market regulator Sebi that Saradha Realty was collecting money in rural Bengal in violation of regulations.
If Saradha was looking for a less inquisitive terrain than Bengal in 2010, it appeared to have found one in Rail Bhavan.
The deal strikes at the root of Mamata’s contention that her familiarity with Saradha is confined to some events associated with the media outlets of the group. The railway deal was struck in end-2010, when Mamata was the railway minister, and continued till 2012. In the intervening years, the railway ministry was headed by three Trinamul ministers — Mamata, Dinesh Trivedi and Mukul Roy. Soon after Trinamul ended its railway and UPA innings, Saradha also faded out of the railway map.
An advertisement Saradha had floated before February 2011 — when Mamata was very much in the saddle in Rail Bhavan though she was spending more time in Calcutta where the Left citadel was crumbling — shows how the group played on its association with the railways.
The advertisement was a sneak preview of how the group would operate in the coming months, which turned out to be Saradha’s golden age as it scooped up cash from depositors in Bengal.
In the ad, the Saradha logo is juxtaposed between that of the Indian Railways and the Indian Railway Catering and Tourism Corporation (IRCTC), an “autonomous” body under the railway ministry.
In a Bengal where Trinamul had come to power, Saradha would soon organise events where it would carefully position itself between the movers and shakers in the government — something that went a long way in making the group credible before the depositors.
In late 2010, sources familiar with the railways at that time said, a Trinamul leader had pitched Saradha Tours & Travels as the company that could bring passengers for the near-empty pilgrim trains run by the IRCTC.
The Saradha company was enrolled by the IRCTC as one of its official travel agents for Bharat Tirth. Railway officials claimed it was easy to squeeze in Saradha because there was no bidding process for tour operators. But logistics players — who take care of accommodation, transfers and local sightseeing — had to take part in bidding.
For tour operators, the eligibility criteria were kept lenient: a turnover of Rs 50 lakh in the previous financial year (which translates into a daily business of Rs 13,700) and a net worth of at least Rs 10 lakh. It was a virtual shoo-in for Saradha.
“Saradha had enrolled as one of the tour operators for at least two trips of the Bharat Tirth train to south India. Saradha was given a 5 per cent commission for every passenger it booked and could use the official logo of the IRCTC in advertisements,” a railway official said.
If the railways thought Saradha would help it fill the trains, the company found the package a godsend to convince investors who had been sold tourism-asset-linked schemes that it enjoyed the trust of a behemoth like the Indian Railways.
The Bharat Tirth — five of the 16 trains originated from Howrah — “trains from Calcutta had hardly any takers because the quality of food served and the hotels were not good. The trains had most of the seats vacant,” said an official.
For all practical purposes, the Bharat Tirth from Howrah stands withdrawn. If it survives in other cities, the service does not appear to be too popular as few officials could confirm the status.
The IRCTC reported a substantial jump in income between 2010 and 2012 as the railways introduced several tourism products and services. Its income grew from Rs 67.04 crore in 2010-11 to Rs 98.95 crore during 2011-12 — an increase of almost 48 per cent.