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Indian politician and industrialist Naveen Jindal is the subject of a newly opened probe by the Enforcement Directoriate (ED) in India, as a result of a claim that he and his family violated foreign exchange laws by operating four bank accounts at a Swiss private bank in Singapore.
Naveed Jindal is a prominent figure in Indian business and politics, as he was a former Member of Parliament, and is also Chairman of Jindal Power, which is a wholly owned subsidiary of Jindal Steel & Power Limited (BOM:532286) which has an annual turnover of over US $3.5 billion.
The company is part of the US$17 billion diversified O.P. Jindal Group. Jindal Steel & Power, or JSPL, (previously known as Jindal Strips Limited) was a moderately performing enterprise when Naveen Jindal first took over its Raigarh and Raipur operations in 1993.
Today, JSPL operates the world’s largest coal-based sponge iron manufacturing plant in Raigarh, Chhattisgarh, and plants in Jharkhand and Odisha. The company has set up captive power plants using waste products from the sponge iron making process to generate power.
A report in the Indian Express today detailed the statement made by the Enforcement Directorate on the probe against Naveen Jindal: “We received an input from Singapore’s financial intelligence unit about four accounts opened in 2010 in Bank Julius and Baer Company Ltd. Following this, we made certain enquiries with the Reserve Bank of India (RBI). The RBI informed us that it did not have any information on the existence of these four accounts.”
“The four accounts are under the name of Naveen Jindal, his wife, daughter and son. We are getting details of the funds in the accounts. Under the legalised remittance scheme a certain amount can be remitted outside India each year, but in this case, the contravention of foreign exchange laws is that RBI was not informed about the four accounts,” said the source.
A statement issued by a spokesperson for Jindal Steel and Power Limited read: “We wish to state that we have not received any notice or information from ED in this regard.” The spokesperson clarified that, nevertheless, “ RBI policy allows the resident individuals to remit funds outside India up to certain amount each year. The policy provides the framework of such remittances and the compliance to be done by the resident individuals.”