Good progress before maiden meet, more needed
Though the Cabinet Committee on Investments (CCI) looks like a damp squib compared to the way its original avatar, the National Investment Board, was envisaged, some progress has been achieved. On the face of things, with the CCI giving the oil and defence ministries 30 days to clear stuck exploration blocks, it appears little has changed. But keep in mind that, some months ago, as many as 73 oil blocks were stuck due to defence ministry objections. After many letters from the cabinet secretary, this list was whittled down to 46; later, another 32 got cleared, even if with some conditions attached; and recently, of the 14 declared to be “no go” by the defence ministry, another 7 got cleared. This leaves 7 blocks in the “no go” area that were the subject of the CCI meet on Wednesday—these are, of course, big ones and include blocks owned by RIL, ONGC and Cairn in the KG Basin area.
While the CCI’s first meeting may have had moderate success, it’s important to keep in mind the defence ministry says it had conveyed its objections to the oil ministry even before the 73 oil/gas blocks were auctioned. How any government could auction projects, where investors put in billions of dollars, with such serious riders shows how casual decision making is. If the defence ministry has now come up with conditions—exploration firms cannot locate any pipelines on sea surface in the blocks cleared for E&P activity, for instance—to clear the oil blocks, why couldn’t this have been done earlier? While the environment ministry cited the Lafarge judgment to justify its actions, this should have been challenged a long time ago. But, more important, even if environment and forest clearances need to be delinked as the roads ministry wanted—the Supreme Court said in the Lafarge case that they must go hand in hand—the roads ministry never had a clear Plan B in case forest clearances were not forthcoming. It’s early days yet, but as the oil blocks saga shows, clearances need monitoring and nudging every step of the way. So far, that hasn’t been happening.