The Hindu : Kerala / Thiruvananthapuram News : Vigilance probe into cement factory deal

Online edition of India's National Newspaper
Wednesday, Jul 18, 2007
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Kerala

Kerala - Thiruvananthapuram

Vigilance probe into cement factory deal

Rs.10,000-crore private investment likely soon, says Elamaram Karim

THIRUVANANTHAPURAM: The Government has ordered a Vigilance probe into irregularities of more than Rs.400 crore in the public sector Malabar Cements, Industries Minister Elamaram Karim said here on Tuesday.

A Vigilance inquiry is already on into irregularities in the award of contracts for the effluent treatment plant at Travancore Titanium Products (TTP) here. The Government is also looking into irregularities relating to the proposed expansion programme of Kerala Minerals and Metals Ltd. (KMML).

The Minister said audit by the Comptroller and Auditor General of India had detected irregularities in the purchase and other contracts entered into by the Malabar Cements during the UDF rule. When contracts were renewed after the present Government came to power, costs came down by about Rs.13 crore.

Mr. Karim said the irregularities that would jeopardise the profitability of the titanium units were detected when the Government reviewed consultancy contracts awarded to the Central sector Mecon Engineers India Ltd. The company was awarded the consultancy in preference to others at a higher cost for the effluent treatment plant in the backdrop of strict orders from the Supreme Court that the plant should be completed against deadlines.

However, the company did not provide any cost work sheets. Now, it was saying that cost would be Rs.414 crore. This might not be viable and hence, the Kerala Technical Industrial Consultancy Organisation was asked to look into the matter before the Government took a decision. Mecon was found to have awarded sub-contracts which might have legal implications.

In the cases of the KMML project, Mecon was given power of attorney. The cost of the project would touch Rs.1,115 crore against an original estimate of Rs.706 crore. This would not be viable. Reduction of import duties on titanium pigment was bringing down the margin of both TTP and KMML.

Private investment totalling Rs.10,000 crore was expected to materialise soon, he said. A committee headed by the Chief Minister would give clearance to projects exceeding Rs.25 crores. The LNG terminal in Kochi would be completed by 2010.

Mr. Karim said talks were under way for setting up a petrochemicals project in Kasaragod. The Kannur power project was proposed to be revived. Land acquisition had begun for the knowledge park at Ramanattukara in Kozhikode district. Nearly 2,500 persons would get employment at the Industrial City proposed to be set up by the Malaysian Government in the district. A major industrial park was proposed for Kidangur in Kottayam district, besides an inland port at Kottayam. A mega industrial park under Infrastructure Kerala Ltd. was planned for Kollam.

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