Tainted coal deal; partner in India suspected of corruption

Partner in India suspected of corruption

September 18, 2012 

Brace yourself for a shock.

Remember last month when state Rep. Keith Hall of Phelps in Pike County helped arrange a deal to sell $7 billion of Appalachian coal to a company in India? Gov. Steve Beshear proudly announced the deal at a Capitol press conference.

Well, it turns out — and you're not going to believe this — the Indian company is at the heart of a huge corruption scandal.

"Coalgate" is what it's being called on the subcontinent. The New York Times' report about the Abhijeet Group and its flamboyant head Manoj Jayaswal was headlined "Scandal bares corruption hampering India's growth."

Jayaswal, who's famous for cultivating cozy ties with politicians, was one of the beneficiaries of murky government deals that allowed him and a lucky few to obtain vast government-owned coal tracts worth many billions of dollars without competitive bidding.

The Indian version of the FBI is investigating whether Jayaswal misled the government and conspired with a member of Parliament to obtain the valuable coal.

The Times reporters said the scandal is exposing "a brazen style of crony capitalism that has enabled politicians and their friends to reap huge profits" at the public's expense. That's much like — and what an uncanny coincidence — Eastern Kentucky.

For example, Hall, who has multiple business interests and calls himself "coal's best friend," paid a $2,000 ethics fine last year after his electrical company received $171,000 in no-bid contracts from the water and sewer utility in Pike County.

The utility is managed by a politically connected private company. The work was broken into multiple contracts to avoid the requirement for competitive bids. As a legislator, Hall had voted in favor of funding for the project on which his company received the no-bid contracts. As a coal operator, he's also used his position in the legislature to push for a rollback in mine-safety laws that would benefit him.

Hall serves on the board of advisors to the New Jersey-based company, FJS Energy, that is the intermediary in the Kentucky coal-to-India deal.

A spokesman for Abhijeet recently told the Hindustan Times in India that the Kentucky coal deal is not at risk.

Meanwhile, let's all hum a round of "it's a small world, after all."

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