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Smart City exits Kerala

June 15, 2009 13:07 IST

The Dubai-based Smart City, which was negotiating with the Kerala government to set up self-sustained townships for information technology and knowledge-based industries near Kochi, has said that it will exit the Kerala project.

The project, which is worth Rs 1,500 crore (Rs 15 billion) would have changed the face of the state but red tape and the lack of interest in the CPI-M leadership following internal bickerings in the party leading to a standstill in administration and a stagnancy in further proceedings has resulted in the Smart City calling it quits.

The proposed Smart City was likely to generate direct employment for 80,000 people and provide indirect employment to another 20,000 people.

In a press statement released the company said that it has withdrawn the contract with the United Kingdom-based multi-disciplinary consultancy which was appointed as the master planner Colin Buchanan to develop the Smart City in Kerala.

The press statement comes after Smart City, Dubai had urged the state government on June 1 to sort out the issue of freehold land and wanted a commitment from the state government that at least 12 per cent of the land would be given for free for the project.

Smart City chief executive Fareed Abdulrahman said that the company was getting to know about the officials' view through the media and there was no clarity on the freehold part.

The Smart City CEO had said earlier that he was expecting a concrete reply from the Kerala government by the first week of June and added that till the state government and Smart City Dubai formally sorted out the issues, the master planners could not start the work proceedings.

Kerala Chief Minister VS Achuthanandan had once lashed out at Smart City officials and had said that it was making unreasonable demands. The proposed project was slated to be jointly commissioned by the Kerala government and Smart City, Dubai on 246 acres of land with a built up area of 8.8 million square feet.

According to the deal almost 70 per cent of the area in the built up was to be earmarked for IT and IT-enabled services. Achuthanandan had laid the foundation stone of the Smart City project on November 16, 2007.

In another development, Kerala Fisheries Minister S Sharma, who is directly involved in the Smart City project, told the media that he has not got any information regarding Smart City dropping the project.

With the Smart City project also leaving the shores of the state, Kerala is fast being viewed as an investor-hostile state.

Arun Lakshman in Thiruvananthapuram