5. What were the main criticisms made by various interest groups against Enron and the Dabhol Power Project? Discuss whether these concerns were valid, particularly given India's priorities and problems, as an economy in transition. There are several key criticisms leveled by different interest groups against Enron and the Dabhol Power Project: Criticism of the Federal Guarantee A World Bank report questioned the guarantee agreement because, in its opinion, it was nothing more than a loan granted by the federal government on behalf of the MSEB if it failed to cover its payments to Enron.Criticism of the initial deal Fueled by the negative reaction to the Dabhol project, the opposition party won in Maharashtra in 1995 on a platform of tossing Enron in the Arabian Sea. The new government promptly appointed a group of ministers, known as the Munde Committee, to review the Dabhol project. The Munde Committee's report criticized both the process by which the project was developed and the terms of the agreement. It found that the initial memorandum of understanding was rushed and unilaterally condemned the absence of competitive bidding and the lack of transparency in the process, criticized subsequent changes to the project design as only addressing Enron's concerns, and discovered that Enron had been given undue favors and concessions. Criticisms of the revised agreement Critics of the revised agreement charged that the revisions were very minor and failed to resolve fundamental project problems, and in fact exacerbated those problems. The revised agreement expanded Phase I of the project from 695 megawatts to 740 megawatts and committed the state to both Phase I and the 1,320 megawatt portion of the project in Phase II. While Maharashtra St......middle of paper......ck bids competitively for its major equipment supplier, General Electric, and its construction partner, Bechtel. Some critics suggest that foreign equipment suppliers were favored over Indian suppliers. However, Enron counters by claiming that it has awarded more than 60 contracts worth over $100 (Rs 3.6 billion) to Indian companies. II from its gas processing plant in Qatar. Once completed, this plant will be owned by a joint venture between Enron Oil & Gas and the government of Qatar. Enron vigorously denied this. Critics suggested that Enron made excessive profits through transfer pricing and by charging arbitrary prices for fuel. However, from Enron's perspective, taking responsibility for fuel supply was a means of reducing risk.