Chidambaram knew the ICICI Bank – Videocon Rs.40,000 crore loan and other dubious deals

It is unusual to see the ever so loquacious ex-Finance Minister keeping mum on the ICICI scam. Why is he quiet?

It is unusual to see the ever so loquacious ex-Finance Minister keeping mum on the ICICI scam. Why is he quiet?
It is unusual to see the ever so loquacious ex-Finance Minister keeping mum on the ICICI scam.

The former Finance Minister P Chidambaram (PC) is acting like an Ostrich as far as matters related to the ICICI Bank are concerned. The normally garrulous man, who will wax eloquent on any topic, including the price he had to pay for a teabag at Chennai airport[1], is maintaining a studied silence on ICICI. It is a known fact that Chanda Kochhar, Shikha Sharma, and Kalpana Morparia formed the ‘teen deviyan’ at ICICI[2] and Kochhar was allegedly handpicked by her mentor K V Kamath, who was very close to PC.

The Public Sector Undertaking firm of Oil and Natural Gas Commission (ONGC) was asked to buy a 10 percent  stake in Videocon’s Mozambique project. For this, ONGC overpaid around 200 million dollars to Videocon.

As per the statement issued by ICICI on March 28, three days after PGurus’ exposé of 10% money trail to Chanda Kochhar’s husband Deepak Kochhar’s firm[3], the ICICI Bank in 2012, in consortium with 20 other banks provided Rs.40,000 crores ($6 billion) to debt-ridden Videocon Group’s Oil and Gas exploration at Mozambique.

The Mozambique investment

This is apart from the controversial Rs.3250 crores ($491 million) loan disbursal to Videocon Group’s firms abroad during the same period. According to ICICI Bank, this dubious loan was also part of a consortium and ICICI Bank has only 10 percent exposure and the rest 90% is financed by other bankers. However, ICICI Bank cleverly left out the names of the other bankers.

Who was the Finance Minister from mid-2012 onwards? Mr. Chidambaram. He must be aware of the entire rollout of the Rs.40,000 crore loan to Videocon Group by the 20-bank consortium for the Oil and Gas project in Mozambique. Further, the name of the agency which charged 5 percent commission in all high volume loans has come out. In ICICI Bank, the high volume deals were processed through an agency owned by Chanda Kochhar’s brother-in-law Rajiv Kochhar[4].

It is difficult to believe that Chidambaram did not know of all these deals as Chanda Kochhar was always seen to be on good terms with him. Therefore it comes as a surprise to see Chidambaram observe total silence in this matter. While this 800-lb gorilla in the room (ICICI scam) was occupying the news space, Chidambaram was seen talking about petroleum prices, what can be at best be compared to a mouse. When his son was cooling his heels in the jail in connection with INX Media, PC was seen running between Supreme Court to trial court, but always managing to find something else to tweet and write about in the media.

In 2013, the UPA managed to do a scam in this oil deal too. The Public Sector Undertaking firm of Oil and Natural Gas Commission (ONGC) was asked to buy a 10 percent  stake in Videocon’s Mozambique project. For this, ONGC overpaid around 200 million dollars to Videocon. This is nothing but a classic instance of Crony Capitalism in India. Indian banks will pay money for Videocon and later the public sector ONGC will buy shares from Videocon’s project at exorbitant rates[5].

As a Finance Minister Chidambaram must be aware of this high volume purchase by ONGC to benefit Videocon. Now the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) are expected to call Chanda Kochhar, her husband and Videocon owners. Will they call Chidambaram too, the man who approved/ consented to these dubious deals?

Note:
1. The conversion rate used in this article is 1 USD = 66.16 Rupees.

References:

[1] Chidambaram gets trolled for complaining about tea price at Chennai airportMar 26, 2018, Business Today

[2] Bank on usApr 3, 2014, The Times of India (Mumbai edition)

[3] ICICI Bank head Chanda Kochhar and husband on the radar of probe agencies for doubtful loans to debt-ridden Videocon Group? Mar 25, 2018, PGurus.com

[4] Governor Patel claimed RBI has more power over private banks. Will it use them now? Apr 3, 2018, MoneyLife.in

[5] ONGC’s $2.4 billion Mozambique deal under oil ministry scannerFeb 2, 2017, LiveMint.com

Team PGurus

16 COMMENTS

  1. There seems a lot of muck in the cupboards of Mr Manmohan Singh Mr Montek Singh Aluwalia and Mr Chidambaram

  2. Why it takes so much time to investigate and bring it to logical conclusion. Only allegations are traded and then nothing happens. Unless systems and institutions are strong, nothing really happens.

  3. The way in which scams are coming out of the bag one by one almost everyday, I think that the banking system in our Country is completely collapsed. It should be noted that all these banks are headed by people, with professional qualifications and vast experience. But unfortunately they succumb themselves to the pressures either from their own family members or from the politicians in high offices. Their loyalty is lost due to their interest to be in power and hold the high offices. Despite the high salary that they draw ( more than 6 to 7 crores per, they end in scandals and scams ultimately. Very sorry state of affairs in the Country. People are loosing their faith with these banks. I think we can depend upon small banks in our Own state.

  4. Real corrupt deals are getting exposed by well informed and educated groups like yours. But the MSM seems least bothered about it as if itis simply not their business. This is understandable given the bias they exhibit towards men and matters of their choice. But what is appalling is the total indifference shown by the government in taking quick action to punish the wrong doers whoever they are. One wonders whether NDA is only a paper tiger that simply cannot tackle corruption.

  5. ICICI bank wrote off some debt/loan in NDTV matter. So this must be some return in favour to turn the other way when ICICI chief got some commission thru their kith&kin…

  6. I am sick with this BJP govt which is having ostrich mentality without taking any action on the rich & powerful just going & punishing the common man. Now it is confirmed that Modi & his govt has no balls & no different from the corrupt Khangress. While Khangress worked hard in looting the country, BJP govt is working hard in protecting the looters.

    Jaitely, Ravi Shankar Prasad, Pratap Rudy & others = are all dump heads.

    BJP communication policy is rotten & absolutely no news coming from any direction if they want to punish any or want to continue till eternity.

    • “Now it is confirmed that Modi & his govt has no balls & no different from the corrupt Khangress” – Sir, if congress was still in power, these scams would have never come out. It means tightening of regulations which are not visible to public happening after nirav modi scam. Let us be patient and not shoot in all directions. We are looking at 70 yrs of deep state/eco system created by corrupt congress. It takes time to clean up the corrupt deep state.

  7. This is the actual growth model of the UPA gov which is steeped in day light robbery of the public exchequer through crony capitalists who in turn gave commission to the Nehruvian elites . Undoubtedly 2004 to 2014 made Nehruvian elites among st the richest in the world (paid media stalwarts also gained immensely) . Now because of such uncompromising journalism we can say for sure how and where the money came from in these scams and who exactly benefited from it. But tragically even today we cannot say for sure if this scarce resource majorly belonging to the poverty ridden ‘hindu’ masses’ will ever be recovered as those culpable still seem to be as powerful as they were during 2004-2014!

  8. The BJP Govt proves no different from UPA. It also plays appeasement politics .. how else one justifies the Govt review petition in SC against the so called atrocities Act? Also, the Govts.compensation to illegal immigrants , human trafficking gang? What is the need to withdraw “fake news” notification? What was AJ and his cronies doing for four years while shedding crocodilebtrars about ballooning NPA but not even scrutinising who are all in the list and where are they?

    • We should rather ask what an independent body called RBI was doing? At least under NDA rule, we don’t have imported RBI governors. This is a crony capitalism model which peaked between 2004 to 2008. Capitalism failed elsewhere it originated in 2008. Swadeshi, decentralized, jathi based economic model is the only way out of this failed and imported model. NDA has 2 jobs in its hands. Clean up the past mess and go back to swadeshi economic model.

  9. Everytime something comes up you say PC knew this UPA knew this then 4 years into Governance what is this Govt. knowing? Nothing, but moves on!!!!!

    • Everything looks legal at the surface level. Scams come out only when money does not add up. Tightening of regulations and slow transition from capitalism to swadeshi economic model is the way to move forward.

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