GAIL’s plans and projects aligned to help India move towards becoming a gas based economy : B C Tripathi
As India marches ahead towards becoming a gas based economy, the role of GAIL (India) Ltd— India’s largest gas transportation company assumes a lot of significance. Out of India’s 15000 kms pipelines network, GAIL owns natural gas pipelines network in excess of 11,000 kms. Besides, the company is currently executing about 3500 kms of pipeline network (under construction) while a large chunk of other projects across the value chain including petrochemical plants, shipping facilities, LNG terminal and others are under various stages of planning and execution. With the increasing demand for gas in the domestic segment, GAIL is also moving fast to expand its city gas distribution (CGD) network, with the most recent being the Rs 10 billion CGD network project announced by Prime Minister Narendra Modi for the city of Varanasi (in Uttar Pradesh). Named as Urja Ganga (or the River of Energy), the project will see GAIL laying a pipeline network of 800 kms in the city of Varanasi and feed clean fuel to nearly 3.7 million population residing in the city. Apart from possessing one of the fastest project execution capabilities for laying pipelines, the company also has six gas processing plants for production of LPG, integrated petrochemical plants, LNG importing facilities (existing and under construction) besides having a decent presence in the upstream oil and gas sector. Along with sister PSUs, GAIL has participating interests (equity stakes) in various oil and gas blocks awarded under the New Exploration Licensing Policy (NELP) bidding rounds of Government of India. In a free-wheeling interaction with Anupama Airy, the Chairman and Managing Director of GAIL (India) Ltd, B C Tripathi spoke in detail about the company’s investment plans and strategies in line with India’s plans to emerge as a gas based economy. The roadmap ahead for the company clearly holds a lot of investment potential for domestic and global companies in the energy space. While doing so, the company is also working towards while already contributing in a big way to the government’s Make in India drive while aiming to create new job opportunities and increased business options for the domestic industry. Excerpts: How is GAIL aligning itself and contributing towards the government’s plans of positioning India as a gas based economy? Also touch upon how your projects are helping the government in its Make in India drive while offering investment opportunities to investors across the globe? The larger policy push of the government is indeed on making India as the gas based economy. So we are trying to place the midstream sector and our operations in line with and aiming to fulfil the government’s vision to spread gas across the country. Even today 50% of the country does not have access to gas so the major expansion plan of the pipeline that we at GAIL have started is about 3,500 kilometers line (trunk pipelines) entailing an investment of Rs 200 billion. This is definitely going to give support to the steel companies, EPC consultancy companies and other associated local equipment suppliers and manufacturers. The second big ticket programme of this government is to supply clean fuel (gas) to households and GAIL is playing a major role in supplying piped natural gas (PNG) to households with Rs 60 billion of approved projects. We are also pushing LPG to rural areas where taking gas pipeline infrastructure is comparatively costly and the government is rightly and in a major way already supplying subsidised LPG to the rural areas. Today the biggest PNG project by GAIL is in the city of Bangalore where there is a huge potential. Now with the recent approval of the Cabinet seven more cities in Eastern India have come to GAIL for providing PNG through a network of pipeline infrastructure. With this, GAIL will be largely present across the big cities in India barring a few like Chennai in South India. All seven cities are along the Jagdishpur-Haldia pipeline and include Varanasi, Patna, Bhubneshwar, Cuttak, Jamshedpur, Ranchi and Kolkata. With these 3500 kms of trunk pipelines you will also have 20 other medium towns which will be in the catchment of these pipelines. They will offer investment opportunities in the city gas sector where the private sector players can come on their own or as Joint venture partners with GAIL and start expanding the city gas network. The other expansion that we are looking at is the east coast LNG terminal at Kakinada. We hope this will be the first LNG terminal that will be commissioned on the east coast. It is on FSRU based project and the target is that by December 2017, this terminal should be commissioned. Lot of activities have already happened and the state government of Andhra Pradesh has already given their in-principal approval to be one of the partners and be the anchor load customer there. This gives support for the financial closure of the project. This is another opportunity where we could invite the international investors to come as partners in the LNG infrastructure on the east coast. Apart from this, in the western India, the old terminal of erstwhile Dabhol will now go for a breakwater as the demerger is going to happen. Following the de-merger, the LNG terminal will be a separate company led by GAIL and we have agreed to infuse further equity (alongwith NTPC Ltd) to create the breakwater facility. So this terminal will also be functional in 2-3 years and unlike now when it remains shut for 5-6 months, it will be made functional round the year after the breakwater facility is created. Then we have the Dhamra LNG terminal in Odisha where we are working with Adani and IOC, where we have taken the equity as also the capacity, should also be ready by 2020. There will also be an LNG terminal in down South near Chennai by IOC apart from our LNG terminals Andhra Pradesh, Odisha and Maharashtra. Then in Kochi you already have an LNG terminal as also in Gujarat. So, the whole
Modi’s Ujjwala scheme set to cross 10 million mark this week
Prime Minister Narendra Modi’s drive to give liquefied petroleum gas (LPG) connections to the poor without upfront charges is gaining the scale of a flagship entitlement scheme akin to the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) piloted by the previous Congress-led United Progressive Alliance (UPA) government. The Ujjwala scheme of distributing clean cooking fuel to women in poor households launched in May by Modi is set to cross 10 million connections this week, with states in the east, north-east and hilly regions being the biggest beneficiaries, a person involved in implementing the scheme said on condition of anonymity. Poll-bound Uttar Pradesh is the largest beneficiary state with 3.4 million poor women getting the connection, followed by states like Rajasthan, Madhya Pradesh, Bihar and Odisha. Jammu & Kashmir, Himachal Pradesh, Uttarakhand, West Bengal, Jharkhand and the north-eastern states too have got priority status under the scheme with no cap on the number of connections to be issued. Members of scheduled castes, scheduled tribes and minorities are the major beneficiaries of the scheme. Interestingly, while the Bharatiya Janata Party (BJP) had performed well in the states of Uttar Pradesh, Rajasthan, Madhya Pradesh and Bihar, the party wants to consolidate its position in states like Odisha and make further inroads into the north-east which together comprise 25 Lok Sabha seats. The BJP is in power in Assam. It also partners government in Nagaland and Arunachal Pradesh. Similarly, West Bengal and Odisha remain crucial for the BJP because the two states together control 63 Lok Sabha seats. Jammu & Kashmir is also a priority area for the BJP where it had won seats in Jammu and Ladakh regions, while the party continued its dismal performance in the Kashmir valley where it drew a blank. The performance was repeated in December 2014 when BJP won seats in Jammu but didn’t open an account in the Valley. The steps taken by the NDA is also crucial because the BJP leadership hopes to play a decisive role in the assembly elections in states like Himachal Pradesh, Madhya Pradesh, Uttarkhand, Uttar Pradesh and north-eastern states in the next two years. States are given priority status if LPG use is less than the national average of 61% of households. Geographically and economically-challenged states received priority as LPG access has been less in those regions. “Our target for the current financial year is 15 million connections. We have already cleared applications more than that and are working towards releasing all of that shortly. In a day or two, we will cross the 10 million mark,” explained the person quoted above. To make sure that all the households that are given connections get easy refills, oil companies Indian Oil Corp. Ltd, Hindustan Petroleum Corp. Ltd and Bharat Petroleum Corp. Ltd are adding the number of distributors. This year, the companies added 300 distributorships and more than 1,600 applications are being processed. Companies have also identified 400 locations for new distributors in Uttar Pradesh. The drive to promote LPG as a clean cooking fuel is altering the country’s energy mix resulting in higher import of LPG and sufficient kerosene for industrial purposes as well as for exports. The drive is also part of a strategy to veer the country towards a gas-based economy in light of the climate change action plan. According to Kalpana Jain, senior director, Deloitte in India, how well gas is absorbed in the economy is a function of infrastructure available to take the fuel to the consumption points. Mikkel Diskerud Jersey
Slow pace of private vehicles switching to compressed natural gas worries government
At a time when the National Democratic Alliance government is pulling out all stops to move towards a gas-based economy, it is concerned about the slow pace of private petrol and diesel vehicles switching to compressed natural gas (CNG), according to two officials from the ministry of petroleum and natural gas who did not want to be identified. Petroleum minister Dharmendra Pradhan has set a target of gas contributing 15% to India’s clean energy mix. Gas currently contributes 6.5% in India’s energy basket. The Narendra Modi-led government’s inclination towards cleaner sources of fuel comes in the backdrop of its pledge to reduce its carbon footprint. India on 2 October became the 62nd country to ratify the Paris climate deal which came into effect on 4 November. “The rate at which cars are adopting gas as fuel is a little worrisome as we wanted a faster conversion rate and more sizeable quantity. A lot of cars have shifted but there are still a lot more to go. We are also looking to increase CNG outlets in the country that will facilitate vehicles to have easier access to the cleaner fuel,” said one of the officials. The petroleum ministry in a draft policy, issued on 5 March 2015, lowered the threshold investment limit for marketing rights for CNG to Rs.5 billion from Rs.20 billion to encourage new retail outlets. According to Petroleum Planning and Analysis Cell, an arm under the petroleum ministry, as on 31 March 2016 there are 1,081 CNG stations in the country with 2,557,895 CNG-fuelled private vehicles consuming a total of 2,155.44 thousand tonnes of the clean fuel. Queries emailed to the spokesperson of the ministry of petroleum and natural gas on 4 October remained unanswered. According to experts, while there is a sizeable chunk of vehicles that use CNG there is a need to increase the number of gas-based vehicles. “Gas-based vehicles have obvious advantages over petrol- and diesel-fuelled vehicles,” said Dilip Khanna, partner at EY, a consultancy. India’s domestic gas production fell by 5% to 33.65 billion cubic metres (bcm) in financial year 2015-16 compared with 35.40 bcm a year ago. Currently, India’s natural gas demand is 473 million standard cu. metre per day (mscmd) which is expected to increase to 494 mscmd in 2017-18 and 523 mscmd in 2018-19. Morten Andersen Womens Jersey
India may shortly move towards dynamic petroleum product pricing model
With two international oil companies set to start retail sale of petroleum products in India, the domestic market’s move towards dynamic pricing seems imminent, said two officials from the ministry of petroleum and natural gas who did not want to be named. Under dynamic, or real-time, pricing, price of a product can vary as fixed by individual retailers across locations and duration of the day. At present, retailers charge uniform prices for petroleum products such as diesel and petrol across outlets in the same region. Though the prices of domestic cooking gas and kerosene are set by the government, petrol and diesel prices are deregulated. “With international entities such as Rosneft OAO and BP Plc coming in the retail scenario, we might see dynamic pricing for petrol and diesel as competition is sure to increase,” said one of the officials. While BP has recently received a licence to set up 3,500 fuel stations, Rosneft inherited 2,700 retail outlets following a deal to acquire Essar Oil Ltd. According to an 8 September 2016 report by Mint newspaper, state-run Hindustan Petroleum Corp. Ltd (HPCL) has already started experimenting with dynamic pricing at select outlets. Currently, India has 56,190 fuel retail outlets, including state-run and private, which sell petrol and diesel of firms such as Indian Oil Corp. Ltd (IOC), HPCL and Bharat Petroleum Corp. Ltd (BPCL). The other firms involved in the fuel retail are Numaligarh Refinery Ltd and Mangalore Refinery and Petrochemicals Ltd. Also, private entities such as Reliance Industries Ltd, Essar Oil (acquired by Roseneft) and Shell India also retail petroleum products. According to a draft policy by the ministry of petroleum and natural gas, there are three retail outlet models in place—dealer owned dealer operated, dealer owned corporation operated and corporation owned corporation operated. Queries emailed to the spokesperson of the petroleum ministry on 4 October remained unanswered. According to experts, competition will improve the retailing standards in the country. “India will now experience international standards which will surely improve consumer experience,” said Sanjay Grover, partner at EY, a consultancy. According to BP Global data, India has emerged as the third-largest consumer of crude oil with a consumption of 4.2 million barrels per day (mbpd) for calendar year 2015, after the US (19.39 mbpd) and China (11.96 mbpd). India overtook Japan, which consumed 4.15 mbpd. A 12 September Fitch Ratings report noted consumption growth for petroleum products to remain strong over the medium term. “Consumption increased by 7.8% in the first quarter of the fiscal year to end-March 2017 compared with 10.9% in FY16. We expect growth to moderate to around 5-6% in FY17 and thereafter. We also expect continued strong gasoline consumption growth of around 9-10% over the medium term, supported by robust passenger vehicle sales amid low crude-oil prices,” the report added. Adrian Colbert Womens Jersey
India could add to global glut of oil products
With India playing an increasingly important role in the global oil market, concerns are growing that its refining capacity may exceed demand. This could force it to export surplus oil products and dampen an already soft global market. India is expected to overtake Japan as the world’s third-thirstiest gulper of oil. And there seems to be significant potential for demand to surge, considering there are still only 21 passenger cars per 1,000 people in the country. In China, the ratio is 87-to-1,000. Many in the oil industry expect the world’s second-most-populous nation to drive the global oil demand from 2020. India’s crude imports have largely continued to grow in recent years. According to the BP Statistical Review of World Energy, the country in 2015 imported 195.1 million tons, up roughly 60% from 2008. Demand is estimated to grow about 4% annually until 2020, when the country is expected to need 900,000 barrels per day more than it did in 2014. That would represent 15% of the 6.1 million barrels per day in global growth during the same period, according to OPEC’s medium-term estimates in 2015. A sign of promise in India’s oil market came on Oct. 15, when a group of companies including Russia’s state-owned Rosneft announced a plan to acquire Essar Oil, a major Indian oil refiner and retailer. The expected demand growth is also prompting Indian refiners to expand capacity. State-owned Indian Oil has announced a plan to double its refining capacity in the next 14 years, according to Ito Mashino of Japan Oil, Gas and Metals National Corp., or Jogmec. “Many oil producers have announced expansion strategies, such as bolstering and updating equipment on the back of the growing demand for oil products,” said Mashino at the Japanese government affiliated corporation. Hindustan Petroleum and Bharat Petroleum also plan to build large refineries, sources say. “Refining margins remain wide now that crude oil prices have fallen,” Mashino said, referring to the difference between the prices of oil products and the cost of the crude they are made from. “Refiners are having a field day.” Sylvester Williams Womens Jersey
SBI plans to raise Rs 5,000 cr via long-term bonds
State Bank of India (SBI) plans to raise Rs 5,000 crore through issuance of long-term bonds in domestic and overseas markets to finance infrastructure and affordable housing in the current fiscal. “A meeting of executive committee of the central board of the bank is scheduled to be held on November 10, 2016, inter alia, to examine and decide for issuance of long-term bonds of Rs 5,000 crore in domestic and overseas markets for financing of infrastructure and affordable housing (Infra Bonds) during financial year 2017 on private placement in tranches at appropriate time,” SBI said in a BSE filing. Ben Tate Authentic Jersey
Roads Sector Plagued By Lack Of Political Will, Not Shortage Of Funds: Nitin Gadkari
The ministry for road transport is not facing any shortage of funds and is confident of achieving the road construction target for the current fiscal year, Union Transport Minister Nitin Gadkari said. “You are all welcome to invest in the sector but I want to give out the message that I am not depending on anybody (for money),” Gadkari said at a Bloomberg event on Monday. Speaking about where this money is coming, he said that his ministry’s budget is Rs 55,000 crore for the current fiscal, which will amount to Rs 2 lakh crore over the next three years. In addition, the ministry can raise up to Rs 70,000 crore by issuing bonds and another Rs 1 lakh crore by monetisation of toll projects, he said. Further, ports are also generating profits and project turnover in that segment is around Rs 4,000 crore. “So money is not the problem. Strong political will is the most important thing,” Gadkari said. Will The Ambitious Target Be Met? The minister said he is confident of achieving the ambitious target of road construction set for this fiscal. At the start of the year, the National Highways Authority of India (NHAI) set an ambitious target of awarding 15,000 km of road and highway projects while an additional 10,000 km worth of projects were to be awarded by the road ministry. The NHAI later scaled back its target to 6,600 km. But he added that the system has to be geared to make time-bound decisions, “I am very much confident, but there is problem with the system. We need some improvement in the mindset of people working for government. We need positive, transparent and time-bound approach, fast track decision making and team work.” The problem lies not with land acquisition or shortage of funding, but with “the mindset of the people working in the system”, he said. Our toll income is Rs 10,000 crore. If we can securitise this income we get Rs 2 lakh crore from the market. We can raise bonds worth Rs 70,000 crore. We can issue masala bonds, we have people ready to invest in it. Nitin Gadkari, Road Transport & Highways Minister But Pace Is A Problem.. However, he said that fewer projects were awarded so far in this fiscal year compared to the first half of the last fiscal, party because several projects are stuck in green courts. Apprehension on the part of banks to lend to infrastructure projects also slowed down project approvals. But the minister sounded confident about the future as he said that as many as 95 percent of stalled road projects are now back on track. For every project, we have conducted 8-10 meetings and we have solved the problem. At the time when I took charge, there were 403 projects that were stalled with a total cost of Rs 3.85 lakh crore. Presently we have only 4-5 projects pending. Nitin Gadkari, Road Transport & Highways Minister The sentiment towards the infrastructure sector has now improved, he added. However, the problems plaguing the sector have not been completely solved, he said. “In public private partnership (PPP) projects, the health of investors is not good. All companies face a lot of problems. At the time, I took charge, they were in ICU, now they are shifted to general ward,” he added. David Mayo Womens Jersey
Govt urges farmers to join hands for greening of highways
Expressing grave concern over the rise in pollution levels, Minister of State for Road Transport & Highways and Shipping Mansukh Lal Mandaviya on Monday urged for greater public participation, especially of farmers, in development and maintenance of highways as “green highways’ and said it would help curb the rising pollution levels. “The current pollution levels in Delhi are an indicator of how we have erroneously adopted the European industrial model, while abandoning our very own age-old Indian Ayurvedic traditions, thus moving away from nature,” he said, addressing the maiden national convention on ‘Innovations in Green Highways’. The Minister also suggested linking of the Green Highways Project with the ongoing Swachh Bharat Mission. “There would be a greater success in greening highways if the local farmers are also involved,” the Minister said adding if farmers are roped in plantation, maintenance, and protection of trees, it would give them a sense of responsibility and ownership. National Highways Authority of India Chairman, Raghav Chandra said he was happy that his organisation while constructing the National highways would also be associated with restoring the environment through aesthetic greening. Chandra said NHAI was confident of awarding 6000 km of National highways for greening by the end of the year, as per a statement from Road Transport and Highways Ministry. He stressed that that greening of National highways would improve the scope for rural employment and create jobs for lakhs of people associated with it. The statement said National Green Highways Mission (NGHM) also inked several pacts including with ITC for undertaking plantation, management & sustainable harvesting activities along NHs besides with Yes Bank for funding roadside plantations under CSR programme and TERI technical collaboration for fostering research & innovation in Green Highways. “NGHM will also sign MoUs with JK Papers for undertaking plantation, management & sustainable harvesting activities along NHs; INBAR for promoting bamboo based applications in Green Highways; World Bank for strengthening Green Highways Programme,” the statement said. The Ministry of Road Transport & Highways has promulgated Green Highways (Plantations, Transplantation, Beautification & Maintenance) Policy – 2015 to undertake highways plantations along National Highways. For the quick roll out of the scheme NGHM, NHAI has been entrusted with the responsibility of implementing entire green highways programme for the Ministry, NHIDCL & NHAI. Zach Miller Womens Jersey
AAI to offer space for various projects
The Airports Authority of India (AAI) has plans of offering space for medical centres, fuel pump and Aviation Skill Development Centres on city side of the Swami Vivekanand Airport in Raipur as part of its mega development and expansion plans, officials informed. Notably, AAI has also drawn up ambitious plans for creating infrastructure for an international level business and leisure destination on the city side of Swami Vivekananda Airport in Raipur. The project aims to provide a world-class environment, in which people can work, play and stay while catering to the surge in traffic of corporate travellers and tourists, officials informed. The entire land 80 acres of land earmarked for developing various types of infrastructure may be provided to multiple entities / developers for modular development on 30 year lease or to a single entity under PPP concessional framework for development of the city-side for 30 year lease, they informed. The AAI believes that development of the city side of the airport would make the region an ‘economic hub’ with exceptional connectivity, officials informed. The city side development of the airport also envisages setting up of hotels and convention centers with an ‘Airport Commercial District’ which would also include ‘Airport Business District’, and a host of world-class passenger convenience amenities among others. Nikolay Kulemin Authentic Jersey
AirAsia executives alerted board, Tatas about lapses in business practices
Senior executives of AirAsia India, the Tata joint venture airline that was severely critiqued by ex-Tata Sons chairman Cyrus Mistry and which is now conducting an internal investigation, had repeatedly complained to the company board and the Tata group about serious lapses in business practices. But no action was taken by any major stakeholder. Mistry was also directly informed. Two major complaints highlighted to the board and the Tata group were that AirAsia India was being “run” by Malaysian parent AirAsia Bhd, in contravention of FDI rules, and that the Indian venture was being “overcharged” by the Malaysian company. Indian rules allow foreign airlines to own up to 49% in domestic airlines but effective management control must remain with the Indian partner. Tata Sons, the holding company of the Tata group, and AirAsia Bhd of Malaysia own 49% each in AirAsia India. AirAsia India chairman S Ramadorai and director R Venkataramanan own the remaining 2%. Tony Fernandes, chief of AirAsia group, and Venkatramanan, a former executive assistant to Tata Sons interim chairman Ratan Tata, have been on the board of AirAsia India since inception. Bo Lingam, deputy CEO of AirAsia Bhd, joined the board as a nominee director on March 31, 2016. Ramadorai has been chairing the board since June 11, 2013. PK Ghose, a Tata veteran, replaced ? Bharat Vasani, chief legal counsel of the Tata group, as nominee director on November 24, 2015. The board also consists of Ashok Sinha and Maya Swaminathan Sinha, who joined on August 11, 2016. ET has reviewed nearly 100 pages of company records and email correspondence between executives and directors. Five people familiar with the matter spoke to ET. They did not want to be identified. AirAsia India executives warned board chairman Ramadorai and director Vasani about potential losses, and the way the airline was being run. Some executives had questioned Fernandes about entering into what they termed as costly financial deals with associate companies of AirAsia Bhd. Email correspondence between February 2014 and July 2015 highlights these complaints. All deals mentioned in these exchanges continue to exist. Fernandes, Tata Sons, Ramadorai, Venkatramanan, Vasani, former AirAsia India CEO Mittu Chandilya and ex-CFO of AirAsia India Vijay Gopalan did not respond to emailed questions seeking comment. MISTRY RESPONSE Mistry “promptly reacted” to indications of wrongdoing and “also escalated the matter to the Tata Sons board”, a person close to Mistry told ET. “A thorough investigation was sought. The details of fraudulent transactions were discovered through an audit. It was taken to its logical conclusion and an FIR was filed against the resistance that has been discussed in the media in recent days,” the person said. Gopalan had warned about the breach of FDI law in an email to Ramadorai, copying Chandilya, on February 14, 2015. This mail also highlighted other issues. He had said, for example, that “revenue management has to be real time and handled by persons familiar with the Indian marketplace and its behaviour”, but the entire process is in Kuala Lumpur (the headquarters of AirAsia Bhd). “This is a significant issue from an effective management control perspective also,” he had written. ET had reported on December 17, 2015 (“Dark Clouds over AirAsia India”) that AirAsia India was facing problems related to feuding shareholders, mounting losses, a severe cash crunch and top-level exits. Cofounder Arun Bhatia, then a junior partner who eventually exited the venture, had told ET then that the management control of the airline was in Kuala Lumpur. ISSUE OF OVERCHARGING Other issues brought to Ramadorai’s attention included allegations that the Malaysian parent was overcharging the Indian airline. One mail from the ex-CFO referred to AirAsia Global Shared Services (AGSS), a wholly-owned subsidiary of AirAsia Bhd. “We have been mandated to use AGSS for outsourcing aspects of finance and accounting, HR functions, procurement and IT,” Gopalan wrote. He added that the budgeted payment to AGSS for 2015 at Rs 9.5 crore is “significantly higher than what it would have been if we were to in-house the entire operations”. There was also a warning that using Tune Insurance, another associate company of the AirAsia group, would reduce AirAsia India’s earnings by 50%. There was also a dispute over selecting an advertising agency. “We have decided not to go with PHAR, which is an AA (AirAsia) Group Company. This could lead to lesser rates as well,” Gopalan noted. AirAsia India picked a public relations firm, Buzz PR. Fernandes was able to push these deals to AirAsia associate companies thanks to a brand licensing agreement (BLA) between AirAsia Bhd and AirAsia India. BLA exists alongside the shareholders agreement and became a key instrument of control, according to people familiar with the matter. BLA and the shareholders agreement were signed on April 17, 2013. Fernandes signed on behalf of AirAsia India and Lingam on behalf of the Malaysian airline.BLA directed that “The licensee (AirAsia India) shall observe and comply strictly with the following operating requirements which are to be determined in AirAsia’s sole discretion”. This provision was to apply to in-flight services, engineering, finance, flight operations, network planning, sales and distribution, among other matters. “The BLA superseded the shareholders agreement on every aspect of AirAsia India’s operations,” said aperson familiar with the matter. Another person familiar with the matter said knowledge of the BLA was limited to the board and senior executives. “It was not shown to the rest of the organisation. And nobody, not even the board, questioned or debated the financial arrangements.” CLEARING PAYMENTS Another complaint from AirAsia India executives to directors related to authority over clearing payments and expenses. Companies typically assign the responsibility of approving payments over a specified limit to the board and payments related to the day to day expenses to the management. In AirAsia India’s case, day to day approvals on key payments, travel, initial offer letters to employees etc came from Fernandes, said a person familiar with the matter. “This process was followed because the authority of this director (Fernandes) was agreed by the