SmartCity Kochi Deal off, says S.Sharma if TECOM adamant

The deal between Kerala government and TECOM will have to be declared null and void if the later remains adamant on free-hold rights for 12 per cent of land, fisheries minister S. Sharma said Sunday

In that case the next cabinet meet will decide on the future course of action he said. He said though several private players have evinced interest in the roject no talks have been held in this regard

The company wants free-hold rights on 12 per cent of land meant for the project, but according to the government his demand is not part of the framework agreement signed between the two parties.

Kerala Chief Minister V.S. Achuthanandan had Saturday asked Smart City Dubai, the developer of a proposed IT park here, to stick to the framework agreement or else the government would "look for other options".

Earlier, the chief minister had said the Dubai firm was financially "broke" and was now coming up with fresh demands that were not part of the framework agreement signed by the two sides to delay the project.

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TECOM will not be given land for sale, says Kerala CM

TECOM will not be given a piece of land for sale in the name of Smart City Project, said Chief Minister V S Achuthanandan. Talking after inaugurating the second phase of developmental works of Info Park in Kochi, VS said there is no uncertainty regarding the Smart City Project. The project will be completed with the help of other companies. TECOM is voicing things which are not in the MoU.

Smart city Kochi: Muthoot Pappachan Group expresses interest

Kerala-based Muthoot Pappachan Group has expressed interest in taking over and developing the Smart city project. The board which met on Thursday morning took this decision. The Muthoot Group had earlier shown interest in the project at the time of its inception.

The decision by Muthoot comes after the Chief Minister V S Achuthanandan cast doubts on the financial ability
of Dubai-based Tecom to develop the joint venture park. The Muthoot Group said that it is ready to deliver the estimate of project cost if the government needs it.

Earlier, in a statement issued in Dubai, Tecom CEO said if the Chief Minister had any doubts about the financial position of the company and its commitment to the project he could visit its campuses in Dubai to get himself convinced.

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SmartCity Kochi dream takes another beating

The long-standing dream of the Kochi SmartCity project - projected as an infrastructure project that would help that city and Kerala move into another gear of economic development - has suffered another stinging blow.

State Chief Minister VS Achuthanandan publicly expressed doubts about the competence of the Dubai-based Technology and Media Free Zone Authority (Tecom) to undertake the project, stating that they were themselves in trouble. Tecom is the state government's partner in the project.

Mr Achuthanandan said that the Dubai company was in a "really pathetic" condition and that they were raising points that were not in the original agreement for the project, adding that the state government would go ahead with the project even in the absence of Tecom. He went on to suggest that a similar project Tecom has in Malta may also not be doing too well.

The Chief Minister has been critical of Tecom in the past but the latest outburst against the Dubai company has given the impression that the state government-Tecom association for the SmartCity project is in deep trouble. The CM had himself laid the foundation stone for the Rs 1,700-crore project two years ago, after which there has been little progress on the project.

Among the main stumbling blocks for the project is a demand by Tecom for freehold status on 12 per cent of the land for the project but the state government is not in agreement with the suggestion, arguing that it was not part of the original understanding.

The Chief Minister said on Wednesday that if the government was going ahead with another partner, it would do that only after talking to SmartCity officials. This is the second time in a fortnight that the Chief Minister is suggesting that the Dubai company may have suffered owing to the financial setback in the Arab world owing to the crisis in the US.

The real estate market in Kakkanad in Kochi, that had soared on the wings of the SmartCity project, is expected to take another correction following the development. The realty market had already dipped owing to the economic slowdown, and further delay in realizing the SmartCity project may dent the market more.

The project envisages 88 lakh sq ft of built-up space on a 246-acre campus and creation of about 90,000 direct jobs.

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THIRUVANANTHAPURAM: Within hours of Kerala chief minister VS Achuthanandan stating that the Dubai-based promoters of the SmartCity Kochi was in a "pathetic" condition, the Dubai company has extended an invitation to the CM to visit its business operations there. In an official statement, SmartCity Kochi CEO Fareed Abdulrahman said his company was "fully committed" to the Kochi project. "Despite the delays beyond our control, we would like to reaffirm our intention to complete this project successfully for the benefit of the people and economy of Kerala. To that end, we have the full support, financially, operationally and otherwise, from our parent company, Tecom Investments", he said.

Mr Abdulrahman said that he wished to highlight his company's commitment towards its legal obligations as outlined in the framework agreement of the project, adding that all parties should be diligent and uncompromising with regard to the agreement. "Therefore, comments that may question our commitment or our legal obligations towards this very important project are misplaced and could impair our shared vision", he said.

The statement said that the company had extended an invitation to the CM "to visit our business operations in Dubai", in addition to highlighting the company's portfolio of business parks.

"Looking ahead, we seek better understanding and cooperation from our counterparts and partners. We would also like to reassure the people of Kerala that SmartCity Kochi is very much a priority for us and we will exert every effort to guarantee its successful fruition", Mr Abdulrahman said.

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Smart City Kochi:Deadline seems to be a ‘dead’ line

Criticising the Government of Kerala for the endless delay in taking decisions regarding the Smart City project, sources close to Tecom said that the implementing agency would have to rethink the future of the project if the government failed to reach a consensus before December 31. “Deadline seems to be a ‘dead’ line’.Tecom is a business entity and projects are based on milestones and timelines.

The State Government has been constantly asking Tecom for deadlines when the transfer of land is still pending. The project will pick up pace only after the land is transferred,” sources said.

The deadline given by Tecom ends in 2009 and the government will have to take a decision on several key issues before that, they said. “The government seems least bothered about the project,” sources said.

The government had earlier made it clear that it did not want the Smart City project to be a real-estate project and it was due to the by-polls that the decision on ‘freehold land’ was delayed. The government also hinted at inviting new promoters for the project if Tecom retracted.

Sources alleged that the government seemed to be giving the media the impression that it had done everything in its power to solve the problems and that government representatives are communicating with Tecom authorities.

“The State Government is not ready to take the responsibility for the project.

Tecom is ready for compromise by no one seems to listen to them,” said sources.

“During the two meetings held between the State Government and Tecom several suggestions for addressing the state’s concerns about freehold land were put across but none of those have been considered by the decision makers. The government has its own interpretations about freehold land and has turned a deaf ear,” sources said.

The board meeting to be held in December will be the forum to decide the next course of action, said Tecom sources.


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Smart City Dubai is Lacking funds: Kerala Chief Minister

Kerala Chief Minister V.S. Achuthanandan Wednesday said Smart City Dubai, the developer of the proposed Smart City IT park in Kochi, was “broke”.
“Since they (Smart City Dubai) don’t have money, they are now trying to come up with numerous excuses,” the chief minister told reporters here when he was asked about the delay of the project.

The government signed an agreement with Smart City Dubai to develop the Rs.1,500-crore project and operate it.

Achuthanandan laid the foundation stone Nov 16, 2007, but the company has not started construction as the government is yet to complete the registration of the land allotted for the project and settle a contentious stamp duty issue.

Another hurdle in the implementation of the project is the issue of awarding 12 percent free-hold land to the Dubai-based firm.

The company wants free-hold rights on 12 percent of land meant for the project, but the government says this demand is not part of the framework agreement signed between the two parties.

Smart City Kochi chairman and state Fisheries Minister S. Sarma told reporters earlier this week that talks between the government and the developer “are still going on” and the government “is hopeful of sorting out issues”.

The last round of bilateral talks between the Dubai team and the government was held in September and it ended without resolving any of the contentious issues.

The date for the next round of talks is yet to be announced.

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Kerala Opposition Party launches campaign for SmartCity Kochi

The Congress Party that leads Kerala’s opposition United Democratic Front (UDF) has launched a campaign for an ambitious IT project, put on hold due to differences between the state government and its Dubai-based promoters.

Ramesh Chennithala, president of the Kerala unit of the party, kicked off the campaign by placing a wreath on the foundation stone of the $350mn SmartCity Kochi project that Chief Minister V S Achuthanandan laid two years back.

SmartCity, which seeks to promote a global network of self-sustained townships for knowledge-based industries, put the project on hold after a dispute over land.

The lease agreement signed on May 13, 2007 lapsed last year and a fresh agreement is yet to be signed. The last round of bilateral talks was held in September and it ended without setting the date for the next round.

The issue has become a subject of heated debate in the state that has one of the highest unemployment rates in India. The UDF highlighted this during its campaign for an assembly by-election held here early this month which its candidate won.

“The plight of such big projects with huge employment potential would be one of the issues that we are going to raise (in the coming elections),” said Chennithala. “It’s a shame that the government has played spoilsport to the biggest foreign investment to the state. They should explain what’s holding them back.”

The SmartCity authorities had earlier sought an assurance from the government on the land by December to save the project but no positive signals came from the state so far. It has since closed down its office here too.

The Kochi project, which is expected to create 90,000 jobs, failed to take off even six years after negotiations began — first due to political opposition and now lack of proactive policies.

The IT industry expects a quantum jump in its software exports with the establishment of similar projects. While Karnataka’s exports touched Rs749.29bn in 2008-09 and Andhra Pradesh and Tamil Nadu exported software worth more than Rs300bn each, Kerala accounted for a poor Rs18.53bn, employing less than 30,000 IT professionals.

Four other mega IT infrastructure projects with a total employment potential of more than 200,000 also hit roadblocks after acquiring land as the government failed to accord the necessary clearances.

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Two years after the foundation stone for the Smart City IT park was laid here, the ambitious project is yet to see any progress, thanks to the unresolved issues between the government and the developer.

The government signed an agreement with Smart City Dubai to develop the Rs.1,500-crore project and operate it.

Chief Minister V.S. Achuthanandan laid the foundation stone on November 16, 2007, but the company has not started construction as the government is yet to complete the registration of the land allotted for the project and settle a contentious stamp duty issue.

Another hurdle in the implementation of the project is the issue of awarding 12 percent free-hold land to the Dubai-based firm.

The company wants free-hold rights on 12 per cent of land meant for the project, but the government says this demand is not part of the framework agreement signed between the two parties.

Smart City Kochi chairman and State Fisheries Minister S. Sarma told reporters Monday that talks between the government and the developer "are still going on" and the government "is hopeful of sorting out issues".

"See, there is a framework agreement to the project and we are bound to honour that. When demands come from outside the agreement it has to be discussed in detail," said Sarma.

The proposed project is slated to come up on a 246-acre plot with 8.8 million square feet of built-up space, of which 70 percent is earmarked for IT and IT-enabled services.

Meanwhile, the state Congress party has announced that it will organise a "memorial service" Monday evening near the project site as nothing has happened at the site after the stone-laying ceremony.

State Congress president Ramesh Chennithala, who will inaugurate the memorial service, told IANS that the Left government was "incapable" of doing anything constructive.

"Isn't a shame that this government has played spoilsport to one of the biggest projects in the state? In the last three-and-a-half years, have they successfully implemented at least one project?" Chennithala asked.

The last round of bilateral talks between the Dubai team and the government was held in September and it ended without any solutions to the contentious issues.

The date for the next round of talks is yet to be announced.

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