The former U.S. energy giant's executives were right -- but not in quite the way they intended.

Discredited internationally for greasing politicians abroad and for cooking the books at home, the company has itself managed to strike the biggest blow yet against liberalisation.

According to Jayati Ghosh, who teaches economics at the Jawaharlal Nehru University, Enron was more than just another transnational corporation (TNC). ''It was in fact the symbol of and even a model for economic activity in India and across the world.''

In 1996, Enron collected 200 million dollars in political risk insurance for its power project at Dabhol, western Maharashtra state, from the Overseas Private Investment Corporation (OPIC), which funds U.S. companies investing abroad.

But Enron fared very well against the successive changes of governments at the state and centre, as well as in dealing with India's formidable bureaucracy.

Given the revelations of Enron's political connections at home in the United States, in the wake of its collapse this month, critics say there is now little doubt that Enron won friends and influenced people in the time-honoured way of these parts -- bribery.

Enron's former chief executive Rebecca Mark once glibly explained away 28 million dollars as having been spent on an ''education fund'' for Indian politicians, while emphasising that U.S. laws were tight on graft and that her company would not dream of it.

Whether or not Enron actually greased palms to penetrate India's state-run energy sector and survive successive changes of government in industrialised Maharashtra state is now for a one-man commission headed by S P Kurudkar to determine and pronounce on. The panel began its work last week.

But quite apart from the 28 million dollar education fund that doubtless benefited people in a Congress party government run by former chief minister Sharad Pawar, there is the curiously changed attitude toward the project by his political opponents -- the Bharatiya Janata Party (BJP) and its close ally, the Hindu fundamentalist Shiv Sena (God's Army).

Pawar and the Congress party were voted out of power in 1995, mainly as the result of a relentless campaign by the BJP-SS combine demanding the scrapping of a power purchase agreement that the Maharashtra state government had with Enron in 1993. That was India's first major step in privatisation.

But far from making good its election promise of ''throwing Enron into the Arabian Sea'', the BJP-SS combine actually renegotiated the power purchase agreement after a visit by Rebecca Mark to the home of SS supremo Bal Thackeray.

This resulted in far more favourable terms for Enron at the cost of the state utility, the Maharashtra State Electricity Board (MSEB).

When the right-wing nationalist BJP led by Prime Minister Atal Bihari Vajpayee first came to power at the national government in 1996, it lasted in power for only 13 days after failing to win a confidence motion in Parliament.

But in that space of time, Vajpayee signed an iron-clad counter-guarantee that vastly benefited Enron.

When Vajpayee and the BJP returned to power at the head of a more cohesive multi-party coalition, they defended the deal by saying that India's state-owned power sector badly needed investment and technology that could only come from abroad and that the utilities were deeply in debt.

Vajpayee said he was only following structural policy changes laid down by the previous Congress party government in 1991, limiting government control over industrial licensing and opening the country to foreign investment while abandoning decades of socialist-style development.

The government ignored charges by local and international rights groups that local residents who protested against environmental devastation in the area around Dabhol, caused by the building of the massive plant, were brutally suppressed by police.

Even the National Human Rights Commission (NHRC), a statutory body, criticised the heavy-handedness with which the BJP-SS government in Maharashtra beat and victimised activists who included eminent lawyers and activists.

So good was the new deal for Enron that it threatened to bankrupt not only the Maharashtra State Electricity Board, but the government of Maharashtra itself when the first phase of the project generating 746 megawatts went online in 2000.

Not surprisingly, Maharashtra's Congress party chief minister -- the BJP-SS combine was voted out in 1999 -- quickly declared the power purchase agreement financially unviable. The chief minister, Vilasrao Deshmukh, prepared to face all manner of legal action by Enron, including invocation of the central government's counter-guarantee.

According to studies carried out by Prayas, a group of young energy professionals based in Pune city in Maharashtra, once the second phase went on stream in 2002, the Maharashtra electricity board would have been paying Enron 52 percent of its revenues to add less than 20 percent to its own installed capacity of 10,000 megawatts.

Prabir Purkayastha of the Delhi Science Forum, an independent group of scientists and engineers based here, said that the only way out would have been for the Maharashtra electricity board to hand over its entire assets to Enron.

''In order to pay for power from a 2,192-megawatt power station, Maharashtra would have to hand over its generating assets for 10,000 megawatts,'' Purkayasha said.

The economics of it was simple. The Maharashtra electricity board was forced, under the terms of the power agreement, to shut down its own plants to buy power from Dabhol -- at seven times the price for distribution to consumers.

In reaction to the expected high price of power, industries began fleeing Maharashtra for other states.

According to Purkayastha, the deal stank mainly because Enron was to be paid for its power in U.S. dollars rather than in Indian rupees. ''If Pepsi and Coca Cola can sell their products in rupees, why should Enron be paid in dollars and that when the rupee is sliding steadily against the dollar?''

Enron, basically an energy trader, demanded that its plant be run on imported naphtha or liquefied natural gas (LNG), which it said could be imported from its fields in the Middle East when India had vast amounts of cheap coal.

Even the World Bank questioned the project's economic viability, citing high costs of importing LNG from Qatar as contracted by Enron.

Even shutting down the plant (as what finally happened six months ago) is hurting India more than Enron. In spite of the talk of foreign investment, in return for deregulation Indian financial institutions were forced to put up 1.4 billion dollars for the project against the one billion dollars Enron actually brought in.

Enron holds 65 percent stake in Dabhol, and its U.S. partners General Electric and Bechtel Corp. own 10 percent each. Their combined 85 percent stake is expected to be put up for competitive bidding as part of a final settlement after the project's suspension. The Maharashtra electricity board owns the remaining 15 percent.

According to Mohan Guruswamy, a former adviser to Finance Minister Yashwant Sinha, the price that is paid for the 85 percent foreign stake will reflect the actual cost of building Dabhol, which is likely to be half of what Enron claimed it did.

Meanwhile, Dabhol has been sent a notice by the Indian customs department for moving away valuable and critical components that had been imported into the country on concessional duty for the Enron project.

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