Enron using pressure tactics?

By Hasan Suroor

LONDON, AUG. 24. In what is seen as pressure tactics, the U.S. power company, Enron, has warned that Washington could impose new sanctions against India if it does not pay up the full $1 billion that Enron claims it spent on setting up a power plant in Maharashtra.

The Enron chairman, Mr. Kenneth Lay, told The Financial Times today that non-payment would amount to ``expropriating'' a U.S. company which could invite economic sanctions under American laws, besides sending a ``damaging'' signal to international investors. ``There are U.S. laws that could prevent the U.S. Government from providing any aid or assistance or other things to India going forward if, in fact, they expropriate property of U.S. companies'', he said.

He pointed out that India had indicated its willingness to solve the dispute amicably and the two sides were working with an international reconciliation team, but he did not rule out an alternative to continuing with arbitration. ``We have very, very tight contracts, and we'll enforce those contracts'', he said.

The Financial Times underlined the fact that ``Mr. Lay is known to have warm relations with the Bush administration which has its roots in the company's home base of Texas.''

Threat denied

PTI reports:

Enron spokesperson, Mr. Mark Palmer, said in Houston that Mr. Lay did not make any kind of threat and he was responding to a question about what might motivate the Indian Government to help break the deadlock. Mr. Palmer was quoted by Bloomberg as saying that the company had not been in contact with the Bush Administration regarding any form of sanctions.

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