Taking strong exception to the ED’s ‘partisan’ act, the Left Democratic Front (LDF) Government has lodged a formal complaint with the Central Election Commission against the Centre and the ED which comes under it. Filing the complaint, Chief Minister Pinarayi Vijayan accused Union Finance Minister Nirmala Sitharaman and the ED of playing politics, and sought the immediate intervention of the Election Commission in the matter. It may be mentioned that the ED filed the case after a statement made by Union Finance Minister Nirmala Sitharaman at Tripunithara on February 28 against the KIIFB and the State Government. In her strongly-worded statement, Sitharaman had called the State budget a KIIFB budget. The ED’s decision amounts to a clear attempt to turn the people against the State Government. The ED is leaking information to anti-Government media with a view to influencing the voting pattern in the Assembly elections, the State Government’s complaint alleged.

Significantly, the ED’s action comes a day after the Central Bureau of Investigation (CBI) informed the Supreme Court that Unitac Builders was a proxy company formed with the knowledge of officials to receive foreign funds for the State Government’s flagship Life Mission Project at Wadakkanchery in Thrisssur district. The CBI’s allegation came in the affidavit it submitted in the apex court to counter the State Government’s appeal against the Kerala High Court’s decision allowing the CBI to continue its probe into the Foreign Contribution (Regulation) Act(FCRA) violations in the Life Mission Project. ED sources have hinted at questioning Kerala’s Finance Minister Thomas Isaac as the funds received by the KIIFB ‘are in violation of norms’.

The ED has sent notices to KIIFB CEO KM Abraham and officials of Axis Bank, which is the banking partner of the venture, to appear for interrogation next week. The ED officials claimed that they had conducted a preliminary probe since the Comptroller and Auditor-General(CAG) came out with a report against KIIFB last year. The ED officers are on record that the agency found that foreign funds were received under the KIIFB without prior sanction of the Central Government violating the provisions of FEMA.

In a prompt response, the CPI(M) State Secretariat accused the BJP of being behind the ED’s move. It is nothing but an act of political vengeance aimed at sabotaging the developmental activities undertaken by the Pinarayi Government, the Secretariat added. The ED’s stratagem is tantamount to an open ‘declaration of war’ against the people of Kerala and will be resisted with all the force at its command, the Secretariat statement averred. The BJP’s political move has the full backing of the Congress, too, the Secretariat said, adding that much is evident from Congress leader Rahul Gandhi’s remark that the central investigative agencies are not acting strongly against the Kerala Government.

State Finance Minister Thomas Isaac has also reacted strongly against the ED’s decision. Addressing the mediapersons, Isaac said the Government is not scared of the ED’s probe against KIIFB. The ED cannot do anything against the KIIFB, he said. The Kerala Finance Minister accused the BJP-led Central Government of misusing the ED for political gains. The ED, Isaac said, was trying to demoralize the officers of the KIIFB. “The ED wants to elicit certain answers favouring its interests. The State Government will not allow the ED to threaten its officers. The State will not step back if the Centre plans a confrontation. The probe is a part of the plot to scuttle Kerala’s development,” the strongly-worded statement added. Isaac denied the charge that the KIIFB was whitening black money. The persons who are making such charges have no understanding of KIIFB’s methods of fund mobilisation. Isaac also said that he will reply to former Prime Minister Manmohan Singh, who may not be aware of the fact that the KIIFB is acting on an annuity model.

The findings of the CAG against the KIIFB’s foreign borrowings, Isaac averred, were not correct. The Union Government, he said, is entitled to frame laws relating to foreign loans. But to claim that the Centre alone can avail of foreign loans is wrong. The Foreign Exchange Maintenance Act(FEMA) allows any body corporate to avail foreign loans with the permission of the Reserve Bank of India(RBI). The KIIFB has strictly followed this guideline and received the green signal from the RBI. The Government has also submitted a report to the RBI on how it intends to spend the loans. It is KIIFB, and not the Kerala Government which has gone for the loans. Since the KIIFB does not fall under the purview of Article 293(1) of the Constitution, there is no violation of constitutional provisions, Isaac claimed.

With the Kerala Government filing a formal complaint with the Election Commission, the ball is now in the court of the EC. The poll body will have to take an early decision in the sensitive matter as the assembly elections are only 32 days away. Any delay to act will be interpreted as the EC’s reluctance to act against the ED. On the face of it, what the ED has done is in flagrant violation of the model code of conduct which has come into effect since the announcement of election dates. It is the responsibility of the EC to ensure a level playing field for the electoral race ahead. All eyes are, therefore, on the EC’s early verdict.

No doubt, the Kerala Government’s deft move has helped it to regain the political initiative it had lost to the Opposition following the setbacks on the ‘recruitments through the backdoor’ issue and the controversial deep sea-fishing deal it had signed with the US-based EMCC company. The opposition had succeeded in pushing the Government on the back foot on both the issues, and derived considerable political mileage out of it. The Government has wriggled out of a tight corner by scrapping the deal with the EMCC. It also undid some of the damage caused by its initial refusal to talk to the agitating job aspirants figuring in the PSC rank list by deputing Law Minister A K Balan to negotiate with them. The Ministerial intervention, on the direction of the Chief Minister, resulted in the Last Grade Servants withdrawing their prolonged agitation.

The ED’s vindictive act also underlines the urgent need to evolve strict guidelines and norms to prevent the Government at the Centre from misusing central investigative agencies to further its interest. This is an essential prerequisite to ensuring a free and fair election. The Election Commission must take the initiative to recommend the necessary legal amendments to ensure a level playing field. Failure to do that would attract the charge of being soft on the ruling party at the Centre. The time to act is now. (IPA Service)