The Enforcement Directorate, which comes under Union Finance Ministry, has filed a case against top executives of the KIIFB, a body created through an Act of the Assembly for mobilising funds for infrastructure projects.
Kerala CM Pinarayi Vijayan
Kerala Chief Minister Pinarayi Vijayan has attacked Union Finance Minister Nirmala Sitharaman for the Enforcement Directorate’s actions against the top executives of Kerala Infrastructure Investment Fund Board (KIIFB). He has also written to the Chief Election Commissioner, saying the Model Code of Conduct was being “torpedoed at the instance of some union ministers”.
The Enforcement Directorate, which comes under Union Finance Ministry, has filed a case against top executives of the KIIFB, a body created through an Act of the Assembly for mobilising funds for infrastructure projects. The officials have been booked in connection with alleged violations of the Foreign Exchange Management Act (FEMA). The Indian Express reports that notices have been served to KIIFB CEO Dr K M Abraham and KIIFB Deputy Managing Director Vikramjit Singh.
The report citing sources said the case is related to FEMA violations in connection with KIIFB raising Rs 2,150 crore masala bonds listed on the London Stock Exchange. ED sources say that the probe has revealed the KIIFB had earned over Rs 2,100 cr through the issuance of bonds for infrastructure projects, but the money was used by other departments like cultural, forestry, fisheries and tourism. The bonds, they say, were issued without the permission of the Centre, which is in violation of rules as foreign debt cannot be raised without the Union Government’s nod.
Chief Minister Pinarayi Vijayan is the chairman and state Finance Minister Thomas Isaac is the vice-chairman of KIIFB.
Despite these findings, the chief minister suggests that the case has been filed on the behest of Sitharaman. Writing to the EC, Vijayan on Wednesday said that the ED had summoned the officials soon after Finance Minister Sitharaman attacked the functioning of the KIIFB. He further said that the ED’s power to summon a witness is intended to gather information and evidence relevant for inquiry and investigation. But here, he said, it is being misused for media propaganda during the time of the election campaign. “The aim is to create a smear campaign against officials and the state government. The very purpose of public trust deposed on officials is being betrayed due to the action of the Union Finance Minister,’’ the chief minister said.
Kerala Finance Minister Isaac, too, has levelled these charges against Sitharaman. He said the ED is under the Union Finance Ministry. “Soon after she (Sitharaman) left Kerala, ED issued summons to KIIFB officials. The agenda is very clear, they want to strangle KIIFB,” he was quoted as saying by IE.
Last week, Sitharaman had questioned the funding and functioning of KIIFB. She said: “I don’t know what budget-making this is when all the money is given to one KIIFB. What is this organisation? We also make a budget in the Union government. We don’t give all money to one particular agency and say, ‘we’ll see’.” The union finance minister also said that the KIIFB’s working had been criticised by CAG as well. She said that the CAG has commented and criticised… “total questionable operation. If this is budget-making, no wonder Kerala is going into a debt trap. And this is a questionable affair. Corruption.”. The CAG’s report on Kerala’s finances for 2018-19 had said that the KIIFB’s off-budget borrowings were unconstitutional, the IE report said.