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A retired IAS officer of 1979 batch, Alexander Luke, has written a letter to Gujarat chief secretary Anil Mukim, stating how an investment of Rs 250 crore made by Vadodara-based public sector unit (PSU), Gujarat State Fertilisers and Chemicals Ltd (GSFC), in a Canadian firm seven years in the past has eroded to simply Rs 10 crore.
In the letter written to Mukim and GSFC Chairman and Managing Director, Arvind Agarwal, on November 2, 2020, the retired IAS officer has identified that the quantity invested in Canadian firm M/s Karnalyte Resources Inc for a 20 per cent stake the corporate in 2013 has eroded.
“The primary purpose of the investment in shares of Karnalyte was an assured supply of potash. Not one ton appears to have been received… The potash project is still at a conceptual stage,” acknowledged Luke in an article he wrote for an online portal, counterview.web, on this situation.
According to him, the GSFC later elevated its stake in the Canadian firm to 38 per cent and the preliminary investment made by the state PSU in the Canadian firm is price simply Rs 10 crore right this moment. Agarwal confirmed to this paper that the PSU’s fairness in Karn-alyte continued to be 38 per cent.
Talking to The Indian Express, the retired IAS officer who headed the 58-year-old GSFC between 2003 and ’06, efficiently turning it right into a profit-making entity, mentioned, “I waited for seven years and after realising that the transient lifetime of the potash mission is over, I made a decision to write about it.
No additional developments are seemingly. If I preserve quiet on the problem, I might not have been in a position to forgive myself.”
Luke, 72, has taken up farming at his village in Kollam district of Kerala. “I have no personal interest in this. But I needed to bring this truth to the people of Gujarat and India,” he added.
When he took up the reins of GSFC in2003, the shares of the corporate had been buying and selling at Rs 17 per share, which jumped to Rs 251 by the time he stop in 2006, two years forward of his scheduled retirement. The loss-making PSU had began making income throughout his tenure.
Chief secretary Anil Mukim didn’t reply to calls, whereas CMD of GSFC Arvind Agarwal mentioned, “He (Luke) has sent an email. It is very long and has some seven or eight links in it. I have not yet seen it. He has been behind this matter for about a year. In January, he tweeted something and it is is not proper for me to comment… It is a seven-year-old matter and there is no point in going in, digging. I don’t know why he is doing it…”
On the standing of GSFC’s investments in the Canadian firm and the potash plant mission, Agarwal mentioned, “Many investment decisions in the course of business may not succeed. It is not proper to blame anyone for it. A person might take 10 decisions, nine may succeed, one may not. If we hold a person responsible for a decision that may not have succeeded, then by that logic nobody will take decisions.”
Adding that GSFC continues to have 38 per cent fairness, he added, “The question of dropping it does not arise as we have invested in the shares of the company… We have not invested in a plant or project. It is now for the company to take up the project. We are not in the day-to- day management of the company… Now when company finds the Potash market suitable, they will take up the project.”
Karnalyte Resources Inc states on its web site that it was based in 2007 and entered right into a strategic partnership with GSFC for USD 44.7 million in 2013. Under this settlement, GSFC was to buy 350,000 tonne of potash per 12 months in Phase-1. The settlement additionally states that GSFC was to enhance its off-take to 600,000 tonnes per 12 months in Phase 2 and up to 10,00,000 tonne per 12 months in Phase 3.
The chairman board of administrators of Karnalyte Resources is Vishvesh D Nanavaty who can be the chief finance officer at GSFC.
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