K.G. Kumar

For the sake of Kerala's industrial and developmental future, the controversy over the Smart City project in Kochi needs to be resolved fast - and fairly.

It looks like the controversy over the proposed Smart City project in Kochi will not die down without a great deal of fire and brimstone. As Kerala is in the midst of polls to elect 140 members to the 12th Legislative Assembly, the issue of what is billed as the State's largest and most prestigious project in the information technology (IT) sector is still hanging fire.

Even though the Kerala High Court quashed the order of the Election Commission directing the State Government to defer the signing of the agreement to establish the Smart City until the Assembly elections are over, Chief Minister Oommen Chandy decided that his United Democratic Front (UDF) Government would not sign the deal with the Dubai Technology and Media Free Zone Authority (TECOM).

Soon after the Prime Minister, Dr Manmohan Singh's recent electoral visit to Kerala, Mr Chandy told reporters he would leave it to the Kerala citizenry to decide whether the project should come up or not. Adding that he was against confrontational politics, the Chief Minister said that though the court had allowed the Government to go ahead with the signing of the agreement, he wanted the voters to decide on the Smart City project.

Whatever be the motive behind his decision, as the chief architect of the project, Mr Chandy deserves some credit for calling halt to a project that has attracted so much of controversy. Equally, and perhaps more importantly, the Chief Minister said that the agreement for the Smart City project would be made public, and posted on the government's official Web site. And the government has kept its word, perhaps a bit too late in the day for effective damage control. Nonetheless, as an exercise in transparency and openness, that act should be welcomed and applauded.

According to the information now made public, the `Framework Agreement' has been proposed by four entities: the Government of Kerala; Infoparks Kerala, a society registered under The Travancore-Cochin Literary, Scientific and Charitable Societies (Registration) Act 1955; Dubai Technology & Media Free Zone Authority (TECOM), a corporate entity of the Emirates of Dubai; and Smart City (Kochi) Infrastructure Private Limited (SPV), a company registered under the Companies Act, 1956.

There are several clauses in the framework agreement, that are open to charges of bias. Among them are the one limiting the government's shareholding in SPV to 9 per cent, to be subscribed out of the transfer consideration of the assets, as well as that denying a casting vote to the Chairman of the Board of Directors of SPV, who shall be a government nominee not below the rank of a Secretary to the Government of Kerala.

The rupee numbers themselves are subject to debate - whether they relate to the land lease ("The consideration for the lease shall be Rupee One (Re 1) per acre per annum, payable annually in advance"), or transfer of assets ("The consideration for the transfer of Assets under the Asset Transfer Agreement shall be the sum of Rupees One Thousand and Ninety Million (Rs. 1,090,000,000)").

The assets, in effect, include all the existing assets of Infopark at Kakkanad. The lease land shall mean "the Connectable land admeasuring a total of one hundred (100) acres in Puthencruz Village".

To be sure, many of the articles and clauses of the framework agreement will be debated ad nauseam in the near future.

Be that as it may, Article 14 on confidentiality is a bit perturbing: "The Parties to this Agreement shall ensure that all persons forming part of or associated with each of the Parties shall observe all confidentiality obligations contained herein or otherwise and shall also keep confidential and secret the terms of this Agreement and any other deed or document (including the Definitive Documents) executed by and between the Parties including but not limited to the correspondences exchanged by and between the Parties (`Confidential Information') unless otherwise required to disclose the Confidential Information due to any requirement under Law."

This is clearly not in keeping with the spirit of openness and transparency that Keralites expect from their government - whatever be its political leaning.

For the sake of Kerala's industrial and developmental future, the Smart City issue needs to be resolved fast - and fairly.

The writer can be contacted at kgkumar@gmail.com

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