The USD 9-billion Cairn-Vedanta deal has finally got clearance (*conditions apply) from the Cabinet Committee on Economic Affairs. And, how are experts reading this mega deal? Well, though they are busy scrutinising it to very first layer, on the cover, the deal seems like a win-win for ONGC and Vedanta. However, Cairn and the Indian government are losers, says SP Tulsian of sptulsian.com.
As per the preconditions, Cairn will now have to bear royalty on its Barmer fields in Rajasthan retrospectively and also withdraw cess arbitration. This means Cairn India will have to lose out to the tune of Rs 16, 800 crore. This royalty, Oil Minister Jaipal Reddy said would be treated as a cost recoverable item. However, Cairn India doesn't feel so and has been maintaining that this is going to adversely impact the future of Cairn India as it will not be in the interest of minority shareholders. Will this create any kind of a problem or a hitch? "No party will accept that in the first instance. I donDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
