Who is greedy is yet to be determined. Anil Ambani has labelled his estranged brother Mukesh in this manner and has accused the petroleum minister of helping him to do this. But what the younger Ambani is not talking of is the gains he will make when he gets the gas at $2.34 per mmbtu as opposed to the current market price of $4.2 per mmbtu. Ambani has made much of the fact that just 1 per cent of the proceeds from the gas go to the government while 99 per cent accrue to Reliance Industries Limited (RIL). But this is not strictly a correct interpretation.
Under the terms of the contract signed with the petroleum ministry, with all contractors and not just RIL, the revenue-share kicks in after all costs have been recovered. So, if RIL has given the government just 1 per cent of the money made by it from the sales of gas in the last quarter, this is because it had to recover its costs. Anil Ambani is free to air his views on the injustice done to him, but this cannot be at the cost of the truth.
Srinjoy Gupta, on email