The Hindu : Kerala News : A landmark in State’s investment history

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Friday, Nov 16, 2007
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Kerala

A landmark in State’s investment history

— Photo: H. Vibhu

Awaiting a new face: A view of the land in Edachira where the proposed Smart City will come up.

The State will witness a landmark in its investment history when Chief Minister V.S. Achuthanandan and Ahmed bin Biath, Executive Chairman of the Dubai-based TECOM Investments, jointly lay the foundations of the Smart City project in Kochi on Friday.

The agreement for the project, in which Sama Dubai is also a partner, was signed on May 13 last.

Modelled on Dubai Internet City, Dubai Media City and Dubai Knowledge Village, it aims at developing Kochi as the hub of knowledge-based industries by offering ideal infrastructure, environment and support systems. It aims at offering a one-stop-shop for allied services.

To be set up with an investment of $350 million, it will be spread over one million square metres of land at Kakkanad. TECOM hopes to leverage its status to bring in global IT and media brands to Kochi.

The project proposes to create 90,000 job opportunities, thus boosting the IT-based economic development of the State.

Kochi will be the first Indian city to form part of the global Smart City network. Smart City has signed a similar agreement with the Government of Malta to establish a business township in Ricasoli in that country.

The signing of the agreement was preceded by intense deliberations, which at times threatened to get derailed. The newly sworn-in Left Democratic Front government steadfastly opposed certain terms, which it perceived as against the interest of the State, agreed to by the former United Democratic Front government.

Mr. Achuthanandan vehemently opposed handing over Infopark for Smart City as agreed to by his predecessor Oommen Chandy. At one point it even seemed that TECOM would drop the project altogether. Eventually, Tecom agreed to the terms proposed by the State and the deal was sealed with the inking of the agreement. As per the agreement, the State would have 16 per cent stake in the project in the beginning; it will rise to 26 per cent within five years

Of late, Mr. Chandy, now Leader of the Opposition, has been alleging that the agreement was changed twice after it received Cabinet approval, depriving the State of the favourable terms which the original agreement had provided. As a result, he said, the State government will have to keep on pumping in funds for increased shareholding every time fresh investments come in. For the time being, all allegations will take the backseat, as the State gears up to embrace one of the biggest projects to come its way.

As Ajay Kumar, State IT Secretary put it: the project will not just bring in huge investments and jobs, but expose the State to global management skills, thus enhancing the standard of local industries. Many positive externalities will be borne out of the project, boosting the overall development of the State, he said.

M.P. Praveen

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