The Wealth Of Sharad Pawar

THE WEALTH OF SHARAD PAWAR by Joyeeta Basu

The less-than-gentle joke in Maharashtra is that Sharad Pawar “Saheb” has enough personal wealth to run Delhi for five years.

Pawar disagrees. The formal statement he has filed before the Election Commission on oath indicates that Pawar is so poor that he might barely manage to buy a mid-size flat in one of the slightly better neighbourhoods of Delhi. He is worth just Rs 3.6 crores. Even a casual chat with Pawar-watchers in mumbai, Pune and Baramati leaves one bedazzled at the Pawar wealth machine. Tales abound about thousands of acres of land, real estate deals, IT parks, corporate hubs, family trusts and nepotism. His wealth is the stuff that legends, and jokes, are made of He has hidden this wealth well. As a senior Marathi journalist in Mumbai, who preferred the security of anonymity, pointed out, no one is willing to expose him. He has money and money buys ‘friends’, in media, in industry, and across political divisions. At the heart of this ‘phenomenon’ is what some people describe as a ‘lust’ for land, mostly agricultural land whose price can go up as much

as 300 times when converted to non-agricultural land in the semi-urban areas of Maharashtra, particularly in the vicinity of Mumbai and Pune. Land has played a considerable role in the controversies that have dogged Sharad Pawar, from the time he was accused of dereserving 285 plots in Mumbai so that they could be sold to industrial houses when he was chief minister. A recent PIL (Public Interest Litigation) has alleged illegal

allotment

of

land

by

Maharashtra

Krishna

Khore

Vikas

Mahamandal (Maharashtra Krishna Valley Development Corporation, MKDVC) over a period of years to benefit the Pawar clan. Land is not bought directly. Once it has been purchased by a frontman (or through a power of attorney taken from the farmer selling the land), an obliging state government starts to build infrastructure in the area. Prices skyrocket; and the land is either sold or used for construction. Satish Magar built Magarpatta City in the Hadapsar area of Pune’s outskirts. It is a spectacular IT and corporate hub built on what was once farmland. A second developer, Aniruddha Deshpande, is one of the promoters of Lavasa hill station, a lifestyle hill resort being advertised by Lavasa Corporation Limited as “Free India’s largest hill station”. Among the promoters, till recently, were Pawar’s daughter Supriya Sule and sonin-law Sadananda, who is a legitimate businessman; they jointly owned substantial shares in Lavasa Corporation. The Sules withdrew from the project in 2006. The project is being developed professionally by some of the best names in big business like Hindustan Construction Company (HCC) of Ajit Gulabchand, the Avanta Group of Gautam Thapar, Venkateshwara

Hatcheries, Aniruddha Deshpande and Vithal Maniar, according to the Lavasa website. Deshpande and Maniar are close associates of Pawar. Maniar is an industrialist and a trustee in Vidya Pratisthan, the educational institute chaired by Pawar. The Pratisthan was started by Pawar in 1972 and now has its own ‘Vidya Nagari’, a campus comprising schools, colleges and hostels in Baramati, Pawar’s constituency, and is run by a trust. If Pawar has powerful supporters, he also has detractors ready to accuse him of impropriety. PIL No. 148 of 2006 was filed in Bombay High Court by Shamsundar Haribhau Potare of Baramati. It alleges that in 2002 Lavasa was illegally given 141.15 hectares of Krishna Valley land at a time when Pawar’s nephew Ajit Pawar, a minister in Maharashtra government, was chairman of MKVDC. It accuses Ajit Pawar and Ramraje Naik Nimbalkar, another minister and MKVDC chairman after Ajit Pawar, of nepotism. According to the PIL, apart from Lavasa, land was illegally given to the following: »Vidya Pratisthan of Baramati, an educational institute of which Pawar is chairman, received 1.45 hectares and 13.1 hectares in Baramati. » Anant Smriti Pratisthan of Baramati (named after Pawar’s brother and Ajit Pawar’s father Anant), received 2.1 hectares in Baramati and one hectare in Pune. » Sharadchandraji Scout and Guide Training Centre, Baramati was allotted 3 hectares of land. The PIL’s primary allegation is that MKDVC leased out around 528.7 hectares of land, a substantial part of which went to Pawar and his

people at an incredibly low price. To give an example, Lavasa was allotted 141.15 hectares of land at a monthly rent of Rs 22,928 for a lease period of 30 years for the project. That is around Rs 275,136 a year, and a little over Rs 82 lakhs in 30 years, chicken-feed when compared to the money involved in Lavasa and the profit to be made from it. The PIL also says that Krishna Valley land is not meant for commercial use, but Lavasa is purely a commercial venture, and that the land was disposed of illegally, without inviting tenders. Significantly, in March this year, the Bombay High Court said that the charges levelled against Pawar and others in the PIL were serious and could not be ignored. Sources say that Lavasa, on the banks of Warasgaon Lake in Mose Valley had its germination around the year 2000 in Pearly Blue Lake Resort Private Limited, in which Aniruddha Deshpande was director. Located in the heart of the Sahyadri mountains, Mose Valley gets its name from the river flowing through it and offers a spectacular view of the neighbouring mountains. About 200 km from Mumbai and 65 km from Pune, the valley has the potential to develop as a prime tourist location. It is also one of the main sources of Pune’s drinking water, with the Khadakvasala dam on Mose river having a live capacity of 11.5 TMC (thousand million cubic) feet, almost as much as Pune needs in a year. Lavasa is being accused of diverting part of that water for its own purpose by building its private dam with a capacity of 1 TMC. Pearly Blue Lake Resort Private Limited re-emerged as Lake City Corporation Private Limited and then Lavasa Corporation Limited. The original and principal shareholders in Lavasa Corporation Limited included Aniruddha Deshpande, Pawar’s daughter Supriya Sule, son-in-

law Sadananda Sule, Vithal Maniar and Venkateshwara Hatcheries Limited. The Sules withdrew from Lavasa soon after a January 2006 Times Of India report drew attention to the fact that the Congress-NCP government had worked overtime to issue clearances to the lake city project. Lavasa of course is much more than the 141 hectares of disputed Krishna Valley land. The hill station is being built in an area that earlier had 17 villages. Critics say that most of the land was acquired from farmers at a rate of Rs 1,000 to Rs 10,000 an acre; the current going rate would be approximately Rs 1 crore an acre. Villagers are not allowed to visit what was once their ancestral land. It is said that the Maharashtra government has seized 200 acres of land which belong to farmers who have run away or gone missing. The government is now leasing out this land to Lavasa. The road to Lavasa is being developed with government money, but naturally. Water plays a central role in any development, so is it a matter of coincidence that Sharad Pawar’s nephew Ajit has been controlling Maharashtra’s water for almost a decade in different capacities, and particularly as water resources minister? Currently, though his water resources portfolio excludes Krishna Valley Irrigation Corporation, he is at the centre of the Lavasa controversy as he was the chairman of MKDVC from December 1999 to December 2004. Pune city is fortunate to have enough water, permitting large-scale development; and when there is large-scale construction activity, politicians are never far behind.

Take the 117.52 km long ‘Ring Road’ that is being built around Pune to decongest city traffic. As many as 15 townships are being planned adjacent to this road. Each of these approximately 100-acre townships will have anything between 10,000 and 15,000 flats, and a 1,000 sq ft flat can cost up to Rs 30 lakh in such areas. The builders involved are part of a coterie surrounding the powerful politicians. Land is also ‘bought’ through power of attorney and de velopment agreements; at least 5,000 acres of farmland have been purchased in Pune’s neighbourhood in different plots. The ‘power of attorney’ scheme also serves to hide the identity of anyone seeking a benami purchase. Other projects include Amanora Park Town, whose launch was announced last year by Aniruddha Deshpande’s City Corporation. Spread over 400 acres of land at Hadapsar and adjacent to Magarpatta City, Amanora will have apartment blocks, school, hospital, market and the other paraphernalia that have become the norm for luxury townships. Nanded City is being built by the farmers of Nanded village about 20 km from Pune. Satish Magar is the promoter of this 700-acre project and is planning to replicate the Magarpatta City model at Nanded. Roha in the Konkan area too has had its share of ‘development’. “Pawar owns property all over the world, right from California to India and beyond,” asserts Sambhajirao Kakade, erstwhile MP from Baramati, a former president of state Janata Dal and now a Congress leader. He has no proof for such an allegation, which may be provoked by political enmity. The Kakade family has known the Pawars right from the time Pawar’s father Govindrao came from Satara to settle in the village of

Katewadi near Baramati and owned a mere three-and-half acres of land. A visit to Baramati taluka and town, about 100 km from Pune, gives one an idea of the extent of the Pawar control, influence and the ability to achieve something if he wants to. Six-time MP from Baramati, Pawar has transformed his stronghold from a sleepy smaller-than-a-smalltown to a wannabe hub of commerce, industry and education. It is an achievement anyone could be proud of. The highway from Pune to Baramati offers a smooth ride through the barren and inhospitable Western Ghats. It is sugarcane country. The approach road is dominated by bullock carts carrying towering bundles of sugarcane to factories. On both sides are pucca houses that were once mud huts. The town, prosperous and posh in parts, is witnessing a building boom and comes complete with wide metalled roads, dividers, street lights and a plethora of colour co-ordinated buildings — even the police station is light apricot, Baramati’s ‘theme’ colour. Amidst this, pride of place is occupied by Pawar’s Vidya Pratisthan. The Pratisthan started off with an English medium school in 1973, and now, in a sprawling and leafy 120-acre campus called Vidya Nagari, runs a variety of schools and colleges teaching everything from law, information

technology

and

engineering

to

biotechnology.

The

Magarpatta City Public School in Magarpatta City is also run by Vidya Pratisthan as also two hostels in Pune city. It is a mammoth venture and attracts students from outside Baramati as well. Even Pawar’s biggest detractors admit that the education provided here is good and that merit counts, not donations.

Baramati has given Pawar mythical stature; his relationship with the grassroots is awesome. He is said to remember by name every person he meets even once. But discontent is evident even in Pawar’s stronghold, the sugar industry, much of which is concentrated in western Maharashtra. According to the latest CAG report on Maharashtra’s sugar industry, the state has 202 co-operative sugar factories, out of which 116 factories are loss-making. Of these, till June 2006, 74 factories have had a negative net worth, and 31 factories have had to face liquidation between 1987 and 2006. Seventy per cent of these co-operatives are controlled by Pawar and his party NCP. Corruption is rampant in the sugar industry, and the CAG report criticises both the state government and the commissioner of sugar for their inability to take action against the boards of directors of these factories. The sugar factories offer many ways of making money, right from making false entries when weighing the sugar being sold to taking commissions while deciding from whom machinery or other purchases, including that of land, will be made. Satish Kakade, a former director of Someshwar sugar factory in Baramati taluka, has many tales of corruption to narrate, including how 14,500 gunny bags of sugar were declared to be of poor quality by the chairman of the board and sold off. He has filed a complaint to the sugar commissioner of Maharashtra citing 38 instances of corruption at Someshwar factory alone. The poor health of the industry, however, has primarily to do with policy. Sugar factories are being expanded into unprofitable by-product oriented ventures like ethanol, cogeneration, distillery, bio-gas etc.

To give an example, Baramati taluka’s Malegaon sugar factory (estimated worth Rs 35 crores), is now being dragged into a cogeneration scheme that will cost Rs 72 crores. At Malegaon factory, Ranjan Taware is one of the directors and heads the farmers’ panel that lost the recent sugar co-operative election to the NCP. He says that factories like Malegaon with a crushing capacity of 640,000 tonnes of sugarcane in the 160-day season are not being able to get their supply from their own farmer members primarily because farmers are not growing sugarcane. So these factories are turning to outside farmers for 55% of their raw material. But expanding into a co-generation project means that the factory will need a supply of eight lakh tonnes of sugarcane every season from its farmer members, a quantity that the farmers cannot provide. Because of poor choice of fertilisers, the land is turning saline and is losing its fertility. Sugarcane yield too has come down to 28-30 tonnes per acre from 50-60 per acre. “From where will we get the sugarcane for such projects?” asks Taware. The loans that these factories are taking are impacting the farmers whose discontent is not taken into account by those in authority. As for ethanol, factories were encouraged to venture into ethanol by successive state and Central governments without taking into account the impact this biofuel can have on food prices. Farmers were assured that the oil companies would buy the ethanol produced in these factories at about Rs 17.50 a litre. But when it came to buy ing the ethanol, the oil companies offered the farmers a price of Rs 15 or so. The farmer’s profit margins went down and he started shying away from ethanol. Leaving controversies about ethanol aside, the bottom line is, this too proved to be an area where policy faltered in front of reality.

As a result, factories like Jawahar in Ichalkarangi, Adinath in Karmala of Solapur, Vasantdada in Sangli have gone into heavy debts. The common consensus in western Maharashtra is that this will have a direct impact on sugar prices in the country, sooner rather than later. India depends on Maharashtra for about 45% of its sugar. Pawar can hardly escape the blame for the situation that prevails in his own backyard.