NEW DELHI: If the 2009 elections were the tipping point in RIL-Congress relations, 2010 was when the old friendship started seriously unraveling. What could have been a temporary cooling off turned into something colder as Congress strategists started seeing a different RIL design – in the person of 58-year-old Parimal Nathwani, group president (corporate affairs and projects), RIL, a native of Gujarat, Rajya Sabha MP from Jharkhand, VP of Gujarat Cricket Association and, as Congress sees him, RIL’s plenipotentiary to Modi.



Nathwani’s prominence in managing RIL’s corporate affairs – for large companies this remit includes liaising with the political establishment – started around the time the Niira Radia tapes produced a flurry of mostly unflattering headlines on the former head of Vaishnavi Corporate Communications. A key Congress strategist described why Nathwani became the lightning rod for Congress’s increasing disaffection with RIL. “Reliance’s orientation, right from the time of Dhirubhai was Congress…Dhirubhai was credited with helping Indira come back to power… the company and its promoters were always seen to be close to the Congress.” “But Parimal changed all that,” this strategist said.



According to him and other senior Congress leaders, the party saw Nathwani as helping Modi at a difficult time for the Gujarat chief minister. These Congress leaders said the Reliance official was a key adviser to Modi when legal issues stemming from a court monitored investigation into Gujarat riots were looming large. Congress perceptions about RIL-BJP close relations grew stronger and stronger.



“We understand businessmen have many friends and RIL was never anti-BJP but it’s another thing when you are sharing a dais with someone and proclaiming him to be the future of the country,” – a Congress leader said, explaining how evidence of Modi-Ambani closeness had been piling up within a year of Congress coming back to power.



Nathwani initially agreed to respond to ET’s questions but subsequently did not reply to the queries. He said one of Congress’s top functionaries had summoned an Ambani aide and told the latter “to keep Nathwani in check”. This functionary, according to the Congress leader, told the Ambani aide, “Dhanda karna hai ki nahin? (Do you want to do business or not?)”. The message was clear.



Nathwani kept a low profile for sometime after that, the Congress leader said. “But things changed again”. In this list of evidence, as Congress saw it, was Nathwani’s re-election to the Rajya Sabha, which “was supported by BJP in Jharkhand”. A senior BJP leader confirmed this. He said Modi’s key aide Amit Shah played a prominent role in getting Nathwani re-elected. Of the 24 signatures Nathwani’s nomination required, 18 were from BJP legislators.



Oil Minister Changes



Nathwani leading RIL’s charm offensive with Modi, as Congress saw it, pretty much coincided with a ministerial portfolio reshuffle that demonstrated, everyone who spoke to ET for this story said, a real turn in Congress-RIL relationship. In January 2011, Murli Deora, who had replaced Manishankar Aiyar as petroleum minister in UPA’s first term, was himself replaced by Jaipal Reddy.



This was followed by staffing and policy changes. S Sundareshan, petroleum secretary under Deora, was replaced by GS Chatutvedi. Then, audit of RIL’s trophy oil fields in the Krishna Godavri region gathered force. Government officials familiar with the matter who spoke on the condition they not be identified told ET RIL’s RIL “access to policymakers was reduced”.



An official said, “RIL executives had enjoyed unfettered access to the oil ministry…but during Reddy’s time, those executives needed an appointment to see the minister or the secretary”. Even for topmost RIL executives like PMS Prasad getting an appointment became difficult, this official said, adding that junior officials started taking cues from their bosses.



The Other Man from RIL



If Nathwani was Ambani’s key aide for relationship management with BJP, Mahendra Nahata, Ambani’s business partner in his 4G telecom venture, was, according to regional party leader, RIL’s “emissary” to state-level satraps. “Nahata has excellent relations with Mayawati, Mulayam and Nitish,” this politician said. He added Nahata may well play a role if and when BJP is in ally-hunting mode.



Congress leaders see other demonstrations of Ambani’s “pro-Modi stance”. They complain about “media outfits financed by Ambani taking an aggressively pro-Modi stand”. Mukesh’s relationship with Modi is different because, as a Congress leader argued, “the RIL chief is actively supporting Modi’s bid for PM”. “Many business leaders praise Modi, but Ambani is helping him substantively”, this leader said. “And it especially doesn’t help when this election is being viewed as Modi vs Rahul.”





The Rahul Factor



Congress leaders familiar with party leadership’s way of functioning say Rahul’s personality and his political style have a large role in worsening the Congress-RIL relationship. Party veterans say unlike BJP, regional parties and even or even Congress under Sonia Gandhi’s sole leadership, businessmen, including Ambani, don’t have direct access to Rahul’s office or to his core team. One party veteran told ET: “Sonia doesn’t have a black and white view of corporatepolitical links.



She has kept corporates generally at a distance but also understands they can’t be ignored completely.” Rahul is different, this leader said. “Over the last few years, with Rahul asserting himself far more in the party, corporate links are being frowned upon…Rahul would think it’s scandalous to appoint Murli Deora as petroleum minister given the perception about Deora and RIL”.



Sandeep Dikshit, Congress MP and widely seen in the party as being close to the vice-president, told ET, “Rahul’s politics doesn’t depend on building personal relations with corporates”. “He (Rahul) has no personal, ideological bias against them. He isn’t anti-industry. He is just a bit circumspect when it comes to corporates and likes to maintain an honorable distance from them,” Dikshit said. Dikshit also gave his point of view on Ambani: “Mukesh has made his personal and political choices quite clear…it’s clear who he is supporting. He isn’t a Congress supporter so Kejriwal or anyone else’s allegation of Congress being his “dukaan” is complete bunkum.” “People have relationships which sometimes can become less important.



Businessmen have friends across the political spectrum,” said external affairs minister Salman Khurshid. The Congress veteran quoted earlier said, “Rahul, unlike his father or even his grandmother, doesn’t see the relevance of Ambani-type corporates in his politics.” Another Congress leader said after the Radia tapes hit headlines, “Rahul and his team were surprised to see how many people were lobbying for Ambani within the government and party.” “His team told him corporates have been running the government… Gandhi has never had warm relations with either of the Ambanis. He is wary of them,” this leader said. “The few meetings between Rahul and Mukesh over the last few years have been short and devoid of warmth”.



The Rahul factor in the Ambani matter, Congress strategists say, was one reason Congress-JD(U) alliance in Bihar didn’t work out when it was first attempted. According to them, former bureaucrat NK Singh, perceived to be close to RIL, was negotiating with Congress on behalf of JD(U). “This didn’t help,” a leader familiar with negotiations said. Congress is bargaining hard with Nitish’s rival Lalu Prasad, while Kumar has so far denied reports of a patch up with Congress.



Modi-Mukesh: Short History



“Our leaders don’t use RIL planes for travel anymore,” said a Congress leader who has known Ambanis for a long time. RIL chairman’s friends in Congress – there are still a few – say Ambani’s support of Modi is fuelled by his company’s huge investments in Gujarat. “Ambani and Adani back him to the hilt,” a Gujarat Congress senior functionary said, adding, “Ruias of Essar who were close to Modi have lost out because of Modi-Ambani relationship”. A cabinet minister known to be close to Ambani says the Modi administration has never “created problems” for RIL’s refinery or petrochemical plant in the state.



According to this minister, Ambani’s relationship with Modi only properly started when the latter became the Gujarat CM in 2001. “Modi faced a lot of resistance from within the party at the time and had a formidable rival in Keshubhai Patel whom he had replaced as CM. Ambanis supported him in consolidating his position,” the minister said.



There’s this story Anil Ambani has said publicly: When Modi first met Dhirubhai, the latter told his sons after the meeting, “yeh lambi race ka ghoda hai. (he’s in for the long game)”. The anecdote is a good insight into how Ambanis have had long and strong ties with the Gujarat CM. Crucially, during the fight between Ambani brothers, Modi is learnt to have kept a neutral stance. Establishment types in Delhi say Modi was one of the few politicians who did that successfully. Pramod Mahajan’s death in 2006 brought Mukesh and Modi closer, a BJP leader said.



“Mahajan was responsible for generating funds for the party and was very close to Ambani…after his death, the party suffered…some people did try to take on the mantle but couldn’t match up to Mahajan. Gujarat (meaning Modi) then played an effective role in bridging that gap,” the BJP leader explained. BJP treasurer Piyush Goel strongly denied the party receiving special funding from any corporate group. “Whatever funding we get we declare to the Election Commission,” Goel said. He declined to get into specifics of the Ambani-Modi relationship.



The Cases… & the Gas



Ambani’s support for Modi, Congress leaders who know the RIL chief say, has also in part got to do with his displeasure with UPA’s handling of some investigations against company units. The Directorate of Revenue Intelligence (DRI) is probing two cases against Ambani’s firms. The first case is probing alleged underinvoicing of petroleum exports to Bahamas. The second case is an investigation into alleged over-invoicing of an oil rig.



RIL executives have been quizzed during the course of these probes. These investigations, Congress leader said, is “more than an irritant for Ambani because even if there is nothing in the two cases, files are rarely closed in the government. Corporates dread the opening of files in investigative agencies since it involves years of harassment.” Some Congress leaders say privately the investigations are testimony to the fact that the Congress leadership is upset with RIL. Other Congress leaders dispute the charge. “If a report comes to the government it can no longer be brushed under the carpet. It has nothing to do with targeting anyone,” a Congress minister said.



Then there’s the hugely controversial gas price issue. Former solicitor general Rohinton Nariman had opined the government recovers $ 1.85 billion from RIL for failing to meet its KG basin production target. The current SG, Mohan Parasaran, upheld the opinion last month. Former oil minister Reddy, people close to RIL allege ensured that gas prices were not increased during his term. It was Reddy who had sought Nariman’s opinion. In his half a dozen meetings with Ambani, Reddy is believed to have upbraided him for the company’s declining production, say people close to Reddy.



“I cannot allow it (increasing gas prices) till the time I am here. What would you have done in my position?” Reddy told Ambani, according to a close aide of the minister. Gas prices were finally increased in 2014 but not without drama. After the Cabinet Committee of Economic Affairs cleared the revised price, the finance ministry questioned the move. Now, people close to RIL allege bureaucrats in the oil ministry are “dragging their feet” over finalizing modalities of bank guarantees from RIL. These guarantees are required before revised gas prices kick in.



Telecom may be another source of friction. Ambani’s 4G telecom venture has hit roadblocks in Congress-NCP ruled Maharashtra over telecom tower issues. “He is upset with us because he thinks we are deliberately creating problems for him in the state,” says a senior Congress leader.



The Tandon Tale



The RIL-Congress relationship isn’t getting better anytime soon, Congress leaders say. And they point to the next demonstration of that: There’s talk of Anu Tandon, Congress MP from Uttar Pradesh and widow of a senior Reliance official, Sandeep Tandon, switching sides to BJP, a Congress leader told ET. India’s oldest party and its richest man will remain cool to each other for some time yet.