Dubai hits back over Smart City allegations

REPRESENTATIVES of a Dubai Internet City (DIC)-backed venture in India have hit-back at allegations that the project is the “biggest land scam” in the country’s history.

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By  Rhys Jones Published  June 19, 2005

REPRESENTATIVES of a Dubai Internet City (DIC)-backed venture in India have hit-back at allegations that the project is the “biggest land scam” in the country’s history. The Smart City project in Kochi, which involves the creation of a self-sustained international hub for IT and bio-technology will cost DIC around US$345 million. However, opposition Communist Party of India (CPI) leader V. S. Achuthanandan claims the development is “a real estate swindle” riddled with corruption. “There is no substance whatsoever to these accusations of malpractice within Smart City,” Anand Singh, director of the Kerala Estate IT mission, which is closely linked with the venture, told Arabian Business. “Some people have a tendency to create a road block for the project because there is a misconception that the foreign capital coming in will take away from business here [in India]. But the Smart City will be a company regulated under Indian laws,” he added. Around 300 acres of land in Kochi and the existing Infopark building, which houses several IT firms have reportedly been transferred to DIC for just US$3.3 million. Kerala edged out Andhra Pradesh, Karnataka and Tamil Nadu to land the project — but opposition leaders are still against it. “It’s just not worth the land being doled out and we will certainly take another close look at it,” said Achuthanandan. The left-wing CPI party also alleges millions of dollars have “changed hands” with the “blessing” of Oommen Chandy, Kerala’s chief minister. This is despite Chandy’s assertion that the cabinet cleared the project on the basis of discussions with Dubai’s government. However, Achuthanandan refutes this claim and says DIC is a private company and the Dubai government is not involved in the project — an allegation Smart City representatives deny. “The land for the project is currently owned by the Kerala government but the modalities of a deal between DIC and the Dubai and Kerala governments for land has not yet been finalised,” explained Singh. “Eventually land will be transferred from the Kerala government to DIC but the final financial details cannot be disclosed as yet,” he added. Kochi’s huge Infopark building currently houses 26 IT companies and IT enabled service providers and earns some US$1.6 million a year in rent from these firms. As a result, opponents of the Smart City project believe handing over the Infopark to DIC would prove to be a huge loss for Kerala’s government. DIC has agreed to create 33,000 jobs within ten years through the Smart City development. If it fails, the company will have to compensate Kerala at a rate of US$140 per job. “We could draw about 400, 000 IT jobs in the next five to 10 years, if we have the infrastructure in place. The Smart City is a big step for us,” predicted K. Vijayaraghavan, a member of Kerala’s State Planning Board. The first phase of Smart City is expected to draw investment worth US$23 million, US$18.5 million of which will come from DIC itself — with the remaining funds due to be contributed by IT companies.

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