UAE firm's India IT project halted by land dispute

Dubai's Emirates Trading Agency's $305mn Kolkota joint venture affected.

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By  James Exelby Published  October 21, 2008

A $305 million IT project in the Indian city of Kolkota, in which Dubai-based Emirates Trading Agency (ETA) is a partner, has come to a halt following protests from farmers, local media reported on Tuesday.

Farmers have protested against giving away the 134-hectare plot for the $305 million project blaming the government for giving them less than their due, India's IT news website itexaminer said.

The farmers claim that the government had bought the land for 4,000 to 5,000 rupees ($81.40 to $102) per cottah (66.9 square metres), and is now selling it for 100,000 to 200,000 rupees ($2,042 to $4,084).

Forum-ETA, a group of Indian businessman Rahul Saraf's Forum Projects and ETA, was planning to develop the project.

It is now concerned that the project may lose its viability due to the delay. The firm stated that it had submitted the first instalment of $33 million to the government more than a year ago.

The dispute mirrors the recent troubles experienced by India's Tata conglomerate which in August abandoned construction of its Nano car assembly plant in Kolkota despite having already spent $350 million.

On their part, Forum-ETA said that as part of the arrangement with the government, the group was supposed to return 160 acres of land to the West Bengal electronic industry development corporation limited (Webel) after developing the land. Webel could further offer the land for IT companies at attractive prices.

The villagers complain that the land that the government is planning to acquire is very good agricultural land. They argue that the government could have acquired thousands of acres of barren land elsewhere.

ETA-Ascon Group is a diversified trading group founded in the UAE in 1973. Its interest range from from civil construction, electro-mechanical and elevator engineering, trading in bulk commodities and shipping.

3256 days ago
Saul Wall

It is a shame that this needs to happen. The farmers are right to be upset. The Indian government probably feels that it is responsible for arranging the project which made the land more valuable and probably feels that the extra money is needed for government services. While that may be reasonable it doesn't change the fact that the farmers can't feel anything other than cheated. If the government looses the deal because they want the profit on the deal they will loose more in the long run. If the deal falls through the farmers will see a major source of economic stimulus and jobs for their young people go down the drain. Both sides ought to compromise quickly.

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