Having angered Kullu's gods once, its proposed ski village is turning to religion THE HIMALAYAN SKI VILLAGE PROJECT ? $300-miliion mountain resort and ski village, over 133 acres in Kulu Valley ? Said to be country's largest FDI-promoted tourism project ? Plans 130 chalets, 485-suite condo, several luxury hotels and other facilities ? Also plans major temple dedicated to promoting Hindutva ? HSV MD John Sims is leading figure in ISKCON movement in India by Chander Suta Dogra in Manali THE last time Indophile American John Robert Sims came up with his controversial $300-million Himalayan Ski Village (hsv) project, not even his long years of association with the International Krishna Consciousness (iskcon) had appeased the gods of Kullu. They had, through their oracles (in the form of local pundits), spoken against the project, at a conclave organised by agitated locals who feared the ski resort would desecrate the sacred mountain abodes of their gods (see Ford vs the Icons, Feb 6,2006). Late last year, Sims did one better. Since the gods wouldn't listen to him, hsv's managing director decided to try K.s. Sudarshan instead, who was still the rss chief at the time, hsv, he told him on a visit to the Nagpur headquarters, was no mere ski resort, it would come up around a temple dedicated to promoting Hindutva. And that through it he was just fulfilling the deathbed wish of his guru, iskcon founder acharya Srila Prab-hupada. All he was asking Sudarshan to do was to persuade the reluctant bjp government in Himachal Pradesh to clear the project. It was the bjp, in fact, then in the opposition, which had orchestrated protests against the project, which had initially been approved by the Congress government of Virbhadra Singh. When the idea was mooted, in 2005, the Himalayan Ski Village, touted as the country's largest FDi-promoted tourism project, had created a stir, especially since it came tagged as an enterprise financed by Alfred Brush Ford, the great-grandson of the legendary automobile tycoon Henry Ford, who wanted to build an 'Aspen' in the Himalayas. But three years down the line, the project has generated serious concerns that it is actually a property development enterprise masquerading as a tourism project so that it can get fdi through the automatic route, which does not attract the kind of scrutiny about the source of foreign funds that fdi coming for property development projects does. Acting on a tipoff, the Enforcement Directorate had in August last year registered a case after a prima facie investigation about alleged violations of the Foreign Exchange Management Act (fema) 1999 by the company, and is now conducting a full inquiry. Under the scanner is the Memorandum of Understanding (MoU) signed between the HP government and the hsv in December 2005, and a subsequent Implementation Agreement (IA) signed in June 2006. Describing the hsv as an "eco-friendly mountain resort and skiing project in the Kullu Valley", clause 7(j) of the MoU states that the government will "allow the company to make sale or sub-lease to any person of the commercial, residential and other buildings or sites within the project area for the purpose of the project," and "shall grant suitable exemption to the company from the provisions of Section 118 of the HP Land Reforms and Tenancy Act 1972, for sale of up to 300 defined units to non-Himachalis." Nowhere in the MoU, the IA or the detailed project report (dpr) is there a definition of'defined units'. The company plans to build 130 chalets, a 485-suite condo hotel and several other luxury hotels and facilities, spread over 133 acres of land belonging to Palchan, Kothi and Burua villages which fall on the route to the Rohtang Pass. And even as Sims is at pains to explain that they envisage a mixed-use resort which has sale of timeshare slots and not outright sale of properties, he admits that there was an understanding with the previous dispensation to sell some properties. "The clause about '300 defined units' was the understanding offered by the previous Congress government in HP," he told Outlook. "If the present government wants to modify or change it, we are willing. I did not draft the MoU or the IA. It was done by the government in Shimla and given to me just before I signed it. When they wrote it, they were trying to accommodate us. We did not anticipate that everyone would get so hysterical." What Sims actually had in mind when he first presented his project to the HP cabinet in 2004 was to acquire control of the entire stretch of the Kullu valley above 2,000 metres north of Naggar on the left bank of the Beas river. Describing it as the 'project influence area' in the draft memorandum, Sims wanted the government to give an undertaking that no other developer would be given access to this area. The draft also sought permission to "develop a new hill station" spread over 150 acres, where rights of development/ownership could be sub-leased or sold to sub-developers. This was later amended in the final MoU after a hue and cry was raised, but not before one key clause was inserted, which made it binding on the government to assist the company in acquiring other lands as and when it might be needed for the project. But if the intention was to build a new township, why disguise it as a tourism project? Because while fdi for real estate projects needs clearance by the Foreign Investment Promotion Board (fipb) and requires full and complete shareholder and director disclosure, for tourism, it can come in through the automatic route, with few questions asked. Besides, one of hsv's shareholders is a Cyprus-based company, Martilis Holdings Ltd, which too is currently under the ED scanner. Companies wanting to mask the trail of their funds inflow register in tax havens like Cyprus, where it is extremely difficult to trace the source of funds coming into bank accounts, as they are governed by their own secrecy laws. Martilis, Sims says, is actually owned by Apollo Real Estate Advisors Ltd of UK, and "Apollo's lawyers," he goes on to add, "for some reason, advised them to register in Cyprus". The ED is enquiring into whether Martilis is actually owned by Apollo. In another curious twist, Alfred Ford has distanced himself from the hsv. He resigned from its board of directors in February 2005, just two-and-a-half months after joining and is now a shareholder, with 10 per cent equity. Why would Ford, a fellow iskcon devotee and a practising Hindu like Sims, resign from the board of a company that promotes Hindutva? Asked the question, Sims told Outlook that "Alfred resigned because he cannot actively participate in the affairs of the hsv, and was told by his lawyers not to keep his name on the board of directors. He is, however, the chairman of the company and that is our obligation to the HP government." WHAT is the real story, though? Did Ford get uneasy about hsv's plans? In a letter to the HP government, his cfo clearly states that Ford would support the project "provided he obtained commercially reasonable bank financing seen internationally in such developments, and assuming such financing would be secured only by the acquired assets themselves". Since external commercial borrowings in the real estate sector are not permitted under fema and securing such borrowings against real estate assets (the land in Manali) in India is prohibited, Ford is clearly implying that he will not be able to invest any more. So, where is the money going to come from? Meanwhile at ground zero