As CAG found Reliance Industries was being favoured in gas exploration deal to the government’s detriment, former Prime Minister Manmohan Singh told the then top auditor Vinod Rai that audit should not hurt the private sector and RIL was one of the biggest and most respected.
“Our refrain was that every time matters were settled between the government and the operator (RIL), it was to the government’s detriment,” Rai has said, while talking about the government-ordered audit by Comptroller and Auditor General (CAG) of KG-basin blocks awarded to an RIL consortium. Elaborating on the matter, which had snowballed into a major controversy with CAG accusing RIL of not being given access to books of accounts required for this audit, Rai said during one of his meetings Singh “felt that audit should not act as a dampener on the enthusiasm of the private sector to partner with the government”.
“The Prime Minister was very emphatic that Reliance was one of our largest, most respected and best-known companies possessing a global reach. Reliance, therefore, had the professional and financial capability to undertake such large projects and compete in global bids,” Rai said.
The former CAG, whose comments in his new book about Singh’s role during 2G spectrum and coal block allocations have already created a flutter, said that he agreed with the then Prime Minister and told him that that auditor generals in all democracies audit such public-private partnerships and do not comment on any “private party making only normal profits”. “However, it was the government that had taken the step to invite CAG to conduct audit, ostensibly with the objective of assuring the public and the Parliament that its interest were being adequately protected,” Rai has written in the book titled ‘The Diary of the Nation’s Conscience Keeper — Not Just an Accountant’. About CAG audit that generated a major controversy with regard to second-generation spectrum allocation, Rai said that a “template response” was given by the Prime Minister to the then telecom minister A Raja, showing a “distanced dealing of the issue”.
“Unbelievably, the Prime Minister chose to ignore the red flags of deviation from policy, and questionable facts and figures offered by the minister (Raja),” Rai said