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P O W E R Darkness at Noon Enron's India odyssey which started with the largest American FDI in India is ending in a whimper. By Debojyoti Chatterjee
Suggest that to Enron's spokesperson in Houston and the answer is a terse: ''No comment.'' But tap Enron watchers and insiders and the picture becomes clearer. Enron's operations in India and in several other emerging markets seem to have become a major headache for the company. Want to know something else? These are the very projects that Mark was gung-ho about. Surprised? Well, don't be. Not only is Enron miffed about its aggressive forays in emerging markets, most of which were spearheaded by Mark, but it's also weeding out many of Mark's old faithfuls in the company. The most recent being Sanjay Bhatnagar, the dapper former CEO of Enron India, who moved to head Enron Broadband Services in Singapore as recently as in January 2001. Last fortnight, Bhatnagar quit the company. Just three months back, Bhatnagar's predecessor in India and an Executive Vice-President of Enron Corp, Joe Sutton, left the company. Sutton had played a key role in Enron's negotiations-both with the Sharad Pawar government in Maharashtra and then with the Shiv Sena government. A quick recap: Enron's Dabhol project was first cleared by the Pawar government in 1993; then when the Shiv Sena-BJP alliance came to power, it rescinded the approval on the grounds that the tariff for Enron's power was too high; finally, Enron mustered all its lobbying power and got the project approved again. But controversy still dogs Enron and its Dabhol project, the latest being the payments crisis involving Maharashtra State Electricity Board (MSEB). Today, Dabhol seems like a $1 billion disaster and Bhatnagar's successor Wade Kline is not deterred from taking a tough stance in his negotiations with the state government. Of course, some of that has to do with the fact that the current CEO of Enron, Jeffrey Skilling (who took over in 1999 from the high profile Kenneth Lay, who is still the company's Chairman) wants to focus more on developed markets where the power sector is deregulated and pegged to market forces. He is also credited with the huge success of Enron's Tyeside operations in the UK. One of the first things Skilling did was to review Rebecca Mark's business decisions, many of which were fuelled by her penchant for tapping the potential of developing markets. The fact that two of her projects-in India and in Croatia-backfired did not help. Two other forays led by Mark-in Kuwait and the Phillipines-had also come unstuck in the mid-nineties. Eventually, Mark moved out. Cut to India and things look rough. Recently, the outgoing US ambassador hinted that the Dabhol project, which is the single largest direct investment from the US in India, may turn out to be a huge disappointment. And observers don't rule out the possibility of the Houston-based energy major selling out or invoking penal clauses in its contractual agreement to exit what may have begun as a dream but has clearly ended up as a bad nightmare. |
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That was
back in 1996. Rebecca Mark was the face of US energy major Enron in India
then. Her charm swayed India's industry and wowed its politicians-from
reluctant union ministers to the Shiv Sena's firebrand leader Bal
Thackeray. Mark managed to wrest the controversial Dabhol Power Project
back from the jaws of defeat. Enron then was on a roll in India. Five
years later, today, it could roll off the map. Two years after Mark's own
fall from grace at Enron's Houston headquarters, the US major seems to be
winding down its once-ambitious Indian operations.