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Kerala Elections: Violation of Model Code, Says Thomas Isaac on ED Notices to KIIFB Officials

Summoning KIIFB officials during polls was a violation of the code of conduct, said state finance minister, alleging a “large political conspiracy”, led by Nirmala Sitharaman.
Thomas Isaac

Thiruvananthapuram: Kerala Finance Minister

T M Thomas Isaac on Wednesday accused the BJP-NDA government at the Centre of trying to destroy the Kerala Infrastructure Investment Fund Board (KIIFB) and thus scuttle the state's

development using the Enforcement Directorate (ED) as Assembly elections were round the corner.

Targeting Union Finance Minister Nirmala Sitharaman, who recently criticised KIIFB, Isaac alleged the Union minister was "misusing" her subordinates for political motives.

Isaac's attack against the Centre and Sitharaman came a day after the ED summoned two top officials of the KIIFB to

appear before it in connection with a probe into its external borrowings through 'Masala Bonds'.

Stating that summoning KIIFB officials at the time of polls was a violation of the code of conduct, he said through the move, a large political conspiracy against the Board, led

by people, including the Union finance minister, has emerged.

"The ED's move is a violation of rules during the time of polls. Union Finance Minister herself is leading the blatant violation of the code of conduct," Isaac alleged at a press meet here.

Any attempt to derail the state's development would be resisted with the support of people, he said.

Sitharaman, at a recent election rally in Ernakulam, had questioned the role of the KIIFB in Kerala budget making.

Dismissing charges that KIIFB's Masala Bond was a violation of the country's Foreign Exchange Management Act (FEMA), Isaac said there were clear guidelines for borrowing

under the Act and any 'body corporate' can take a loan from abroad with the permission of the Reserve Bank.

As per the guidelines, KIIFB had applied to the RBI, through banks, and received the mandatory permission.

"That's how the loans were taken," he explained, adding that the report on what the money was taken for was also submitted to the apex bank.

The ED was cooking up false stories without even a preliminary understanding of how KIIFB was raising its funds, Isaac said.

Confirming that the agency had summoned KIIFB officials two times before also, he alleged that the ED investigators had threatened the state officials.

A BJP leader's son was entrusted with the

investigation against the KIIFB and he had track-record of carrying out raids in the houses of non-BJP leaders in various states on behalf of the saffron party, Isaac alleged.

CPI(M) state acting secretary VIjayaraghavan also flayed the Centre and said no Central agencies would be allowed to scuttle Kerala's development.

He told reporters here that the ED probe was a

political move by the BJP targeting assembly election.

However, BJP state president K Surendran welcomed the ED probe against KIIFB and alleged that Chief Minister Pinarayi Vijayan had ruled the state for the last five years under the cover of a fraudulent group.

The ED officials on Tuesday confirmed that notices had been issued to the KIIFB Chief Executive Officer (CEO) and deputy CEO directing them to join the probe next week.

The ED is probing whether the KIIFB violated

provisions of the Foreign Exchange Management Act (FEMA) in its external borrowings through 'Masala Bonds'.

Masala bonds are specialised debt instruments issued outside India but denominated in Indian Rupees, rather than the local currency.

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