A London-based Indian national, Pramod Mittal, plans to use the $446 million paid by the Nigerian government as a settlement for the moribund Ajaokuta to clear personal debt.
According to a Bloomberg report on Friday, Pramod Mittal, who is the younger brother of billionaire Lakshmi Mittal, has a legacy of defunct factories and unpaid bills.
However, he plans on getting a helping hand out of financial distress from Nigeria’s settlement made earlier this year, as the country agreed to pay his company almost $500 million to settle a contract dispute over a deal that was once said to be tarnished by fraud.
Five years ago, Mittal owed $167 million to Moorgate Industries Ltd., a spinoff of one of the largest steel dealers in the world, and the Isle of Man court ordered the liquidation of his company, Global Steel Holdings Ltd. (GSH), which was registered there.
Three years ago, as a UK court considered Moorgate’s plea to declare Pramod personally bankrupt, the Indian national living in London hoped to get compensation from the Nigerian government.
Although the judge did not see it that way at the time, the 67-year-old’s settlement with Nigeria from last year is now looking like his best option for avoiding bankruptcy.
While court documents reveal that payments from the Nigerian government had been sent to GSH’s liquidators, Moorgate still hadn’t received any of that cash as of October 4.
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In January 2023, Nigeria’s former Information Minister Lai Mohammed stated the government had paid $446 million to GSH’s local unit in various instalments under the settlement.
According to records submitted by the company’s liquidators, between October 2022 and February 2023, the legal firm hired by the Nigerian subsidiary for the mediation transferred a total of £219 million ($272 million) from these monies to GSH’s account.
The settlement, which is equivalent to around 1.5% of Nigeria’s foreign reserves, is the latest chapter in the 44-year-long saga of the massive Soviet-built manufacturing complex in Nigeria.
More than $7 billion in public funds have been sucked into the project, but no metal has been produced. Located 190 km south of the capital Abuja, on the banks of the Niger River, the Ajaokuta steel plant has become a byword for the corruption, poor government, and ineptitude that plague the West African country.
Many people have strong opinions about what should be done with the country’s most infamous white elephant.
Speaking with Bloomberg, a former Nigeria expert for US intelligence agencies and now an associate fellow at London-based Chatham House, Matthew Page, said:
- “Ajaokuta has been a black hole that has gobbled up billions of dollars, enriching multiple generations of politicians and foreign enablers.
- “This last failed reboot and the giant price tag that came with it is a preview of the next failed re-concessioning attempt. At this point, Ajaokuta’s dilapidated machinery is capable of doing only one thing: making public funds disappear.”
Despite being moribund for years and gulping large sums of taxpayers’ money, the current Nigerian government remains committed to the Ajaokuta plant.
President Bola Tinubu campaigned on a promise to restore operations at the steel plant. His outgoing administration in May took pride in having freed Ajaokuta from Pramod’s legal claim and having done so for a sum far less than the $5.3 billion that GSH had supposedly requested in a settlement.
Last month, Vice President Kashim Shettima claimed the “Ajaokuta plant can be a game changer for the Nigerian nation,” referring to the complex’s potential to one day provide half a million jobs.
It’s obvious the country is going nowhere with these unpatriotic and treacherous leaders all over the place, willing to betray and pauperize their own country for personal material gains.
Thanks bro. Whilst it’s obvious our leaders are corrupt and leads the way to it, but 95%of us all when given any opportunity still find a way to enrich him or her self wrongly, are we all then not corrupt? I mean in every sector of human endeavor…… Thaksnroooo thanks
People should be punished for mismanaging the affairs of our country. Imagine the amount of money we are losing as a result of someone’s ineptitude. The same person is probably still at the helm of affairs in the country. We can not continue this way if we truly want to make progress.
What Nigerians don’t understand is that humans are vultures we will gather around easy prey and the truth is the Nigerian system is easy prey for the wealth and well connected we need to ask the government to remove it’s hand from all aspects of the economy and let the private sector grow most especially the SME
The same private sector in the oil industry are frustrating us already, abeg we don’t want privatization, we will get it right soon. Every country has its flaws
The most baffling and inexplicable aspect of Nigeria is this, it will only take a very tiny tiny fraction of the looting machine to fix all of Nigeria’s problems. And if the Nigeria’s problems are fixed and all basic infrastructure are functioning, the main beneficiaries will be the members of the cleptocracy. Because there will be more money to be looted. So why they won’t and can’t fix the country’s problems nobody will ever know.
It’s so unfortunate and unpatriotic some Nigerians can get. They betray several millions of citizens, for their stomachs. It’s s pre-planned fraud against gullible Nigerians. Very sad indeed.
This is just an SPV that this Mital fellow in conjunction with corrupt Nigerian officials used to cash out. The company that built the complex was ready to come reactivate it but the Nigerian govt deemed it ok to give this guy with no technical and financial capacity for Ajaokuta.
This reminds one the generations of fools and idiots that Nigeria has produced as leaders and the doom cycle of gloom only seems to get worst. How on earth can an Indian company that did more of vandalising the complex get paid of even a penny except in odious collusion with government officials that will their cuts from the fraudulent pay out.
30 YEARS AGO WHEN I WAS GOING TO SCHOOL IN GERMANY A MAGAZINE CALLED SPIEGEL USED AJAOKUTA STEEL COMPANY AS ITS HEADLINE
THE HEADLINE READ “AJAOKUTA STEEL COMPANY THE BIGGEST HUMAN WASTE IN HISTORY”
IF AFTER THESE YEARS THE COMPANY IS STILL BEING USED TO SIPHON NIGERIAN MONEY THEN I WONDER THE RECORD IN WILL BE HOLDING TODAY
GOD HAVE MERCY
President Bola Ahmed Tinubu should try as matter of urgency fulfill his compaign promises concerning the Ajaokuta steel company to reduce the unemployment in the country because 90% of us are jobless our certificate are decaying at home