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Last Updated : Nov 30, 2018 05:39 PM IST | Source: Moneycontrol.com

IL&FS crisis stokes fears in Ethiopia, 7 Indian employees held hostage over unpaid wages: Report

Unpaid local workers have reportedly detained IL&FS employees at three sites in Ethiopia.

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The Ministry of External Affairs is investigating reports of seven Indian employees of Infrastructure Leasing and Financial Services (IL&FS) being detained by unpaid local staff in Ethiopia.

The employees, presumably in a hostage-like situation, have been detained since November 25 at three sites in the Oromia and Amhara states. One Neeraj Raghuwanshi identifying himself as an IL&FS employee in Ethiopia has tweeted to several officials, including Prime Minister Narendra Modi. Even IL&FS employees have not been paid in the past five months, he tweeted.

An official from the Ministry of External Affairs (MEA) told Bloomberg that they are looking into the matter. IL&FS did not respond to the news agency’s request for comment. Moneycontrol couldn't independently verify the report.

“Concerns of project termination and absence of senior management from project camps might have triggered panic in local employees and led them to believe confining expat employees might force the organization to pay their salaries,” the employees wrote in a letter addressed to the Indian and Spanish ambassadors, and a few Ethiopian ministries.

India’s external affairs ministry is looking into the claims, and an official at the Indian Embassy in Addis Ababa is following up with Ethiopian authorities, the report said.

IL&FS’s default on debt payments triggered fears of a liquidity crisis in the NBFC space, causing the Indian stock market to crash on September 21.

Also read: IL&FS puts renewable energy assets on sale as part of resolution process

In their letter, the detained employees said the police and officials are siding with the local staffers. Oromia’s police commissioner general, and spokespersons for the both the states did not respond to the agency's calls and texts.

The employees added that local staff had panicked due to fears of closure of some road projects being built as Indian and Spanish joint ventures.

IL&FS Transportation Networks, a listed unit of IL&FS, and Spanish companies Elsamex and Ecoasfalt have formed joint ventures for road construction projects in Ethiopia.

The letter has been addressed to the ILF&FS management, Indian and Spanish ambassadors, several Ethiopian ministries and the local World Bank representative.

The IL&FS employees also said they tried assuring the local staff that their salaries would be paid on time.

The email adds that the IL&FS management has said it cannot send funds due to restrictions placed by the Reserve Bank of India (RBI).

Ethiopian Revenue Ministry spokesman Addis Yirga and Attorney General Office spokesman Zinabu Tunu told Bloomberg that they couldn’t comment on concerns expressed by the employees.
First Published on Nov 30, 2018 11:37 am
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