Karnataka   

New consortium makes attractive promises

BANGALORE: The four-page proposal by the Global Infrastructure Consortium (GIC) offering to implement the Bangalore–Mysore Infrastructure Corridor Project (BMICP) that was placed before the State Cabinet on Thursday seeks to upstage the present developer of the project on several counts.

Although the promises made by the new consortium appear attractive, mystery still surrounds the structure of the entity and the companies that are part of the consortium.

Despite this, the new entity that seeks to take over the long-pending and controversy-mired project from Nandi Infrastructure Corridor Enterprises (NICE) has brought several offers to the negotiating table. It promises to outdo NICE in terms of project deadline, quality of work, (lower) land requirement, and (higher) returns to the Government from land.

The initial proposal by GIC was made to the Public Works Department on July 6, 2007. The consortium that initially comprised six companies said it was agreeable to a “Swiss Challenge” if the Government so desired.

Attempts by The Hindu to contact officials of GIC were not fruitful as the address and telephone number of its Bangalore office was false. Its letter head gives its address as 100, 4th Cross, 4th Block, Koramangala in Bangalore that belongs to Ashford Infrastructure Holding Pvt. Ltd. that has no connection with the consortium. “We are definitely not part of the consortium and have even told them not to use our address or telephone numbers for any of their communication,” a male voice at the other end said.

The consortium, according to the proposal submitted to the Government, comprises the U.S.-based Indus Capital, New York Life Insurance Fund, Avenue Capital and IREO Fund, besides the Mumbai-based Urban Infrastructure Fund and SKIL Infrastructure Ltd. Meanwhile, it is also learnt that Indus Capital has expressed surprise over the inclusion of its name in the consortium while another U.S.-based company has withdrawn from the consortium.

Ben D. Somma, a senior executive of Indus Capital in a letter to NICE managing director Ashok Kheny has said, “Indus Capital did not authorise Nikhil Gandhi to use our name and we have no knowledge of this proposal. As such, Indus Capital lends no support whatsoever to Nikhil Gandhi on his proposal.”

It has clarified that Indus Capital has a business relationship with SKIL Group and are investors in Pipavav Shipyards Ltd., currently in dialogue with SKIL Group about potential investments in Mumbai and Goa.

However, nothing about these investments pertained to the above referred proposal, Mr. Ben said.

The GIC proposals include a self-imposed stiff penalty of between Rs. 3 lakh and Rs. 5 lakh for project delays. It has promised to complete the project in seven years from the date of financial closure. It has reduced the demand for land for the road project by 500 acres compared to the NICE project. It has hiked the annual lease amount for government land from Rs. 10 that is offered by NICE to Rs. 1,180 an acre.

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