Kerala Congress Labels ED Notice to Chief Minister Vijayan as 'Fraudulent' in KIIFB Masala Bond Case

The Kerala Congress has expressed deep skepticism regarding the Enforcement Directorate's show-cause notice to Chief Minister Pinarayi Vijayan in the KIIFB Masala Bond case, labeling the agency's action as "fraudulent."

Senior Congress leader Ramesh Chennithala stated at a press conference in Kozhikode that the masala bond issued through the Kerala Infrastructure Investment Fund Board (KIIFB) involved significant corruption that requires thorough investigation.

Chennithala emphasized the Congress party's commitment to uncovering the truth and exposing corruption in this matter, regardless of obstacles.

He accused both the BJP and CPI(M) of manipulating the Enforcement Directorate, suggesting that the recent show-cause notice represents covert cooperation between these political parties.

"The ED will send a notice during election time. After the election, there won't be any follow-up. This is a tactic by the BJP to help the CPI(M)," Chennithala alleged.

The former home minister further claimed that this maneuver aims to "protect Chief Minister Vijayan and his government, which had become notorious for anti-people policies." He also pointed out that a Canadian company, identified as a major investor in the KIIFB masala bond, maintains close connections with SNC-Lavalin.

"The masala bond was issued to help the Lavalin company," Chennithala asserted.

His comments gain particular relevance considering Chief Minister Vijayan's previous corruption allegations regarding a contract awarded to Canadian firm SNC-Lavalin, a decision that reportedly caused financial losses to the state when he served as power minister in 1996.

Chennithala noted that he had raised these concerns years ago while serving as Leader of the Opposition, and maintained that his allegations "have now proved to be true." He concluded firmly: "We don't trust the ED's show cause notice. It is fraudulent."

The Enforcement Directorate has issued show-cause notices to Kerala Chief Minister Vijayan, former finance minister T M Thomas Isaac, and the CM's Chief Principal Secretary K M Abraham regarding the KIIFB masala bond case.

The notice, issued approximately 10-12 days ago under Foreign Exchange Management Act (FEMA) provisions, does not require personal appearance.

According to ED sources, such show-cause notices are issued following completion of FEMA investigations, with the quantified contravention functioning similarly to a penalty.

The investigation focuses on the end-use of Rs 2,000 crore raised by KIIFB through masala bonds and its compliance with FEMA regulations.

KIIFB serves as the state government's primary agency for financing major infrastructure projects. In 2019, it raised Rs 2,150 crore through its inaugural masala bond issue as part of its ambitious plan to mobilize Rs 50,000 crore for critical infrastructure development across Kerala.