Kerala Opposition Leader Oommen Chandy

Kerala Opposition Leader Oommen Chandy

Opposition Leader of Kerala Oommen Chandy has once again raised allegations directed against Chief Minister V. S. Achuthanandan that undue concessions had been made for the Smart City Project, jointly promoted by Dubai based TECOM Investments and the Government. This time, he is saying that the Smart City had been given higher concessions than those provided for in the SEZ policy adopted by the Government last week.

Mr. Chandy’s disappointment is understandable. He could not ink his dream project in 2006 because of protests from Achuthanandan who was then the Opposition Leader. When Mr. Achuthanandan became the Chief Minister, he could strike a deal which was far better than one contemplated by the Chandy Government.

Just to cite a few examples, the Government did not have to part with the Infopark or guarantee exclusivity to the Smart City in development IT infrastructure in Ernakulam district. Higher share was also specified for the Government in the company implementing the project.

Ever since Mr. Achuthanandan signed the deal, Mr. Chandy was trying to belittle Mr. Achuthanandan’s achievement by repeatedly making allegations. Thus he is hoping that he could divert public attention from his failure to strike a better deal and allegations that the UDF leaders were bargaining for kickbacks.

This is not to say that Mr. Achuthanandan had not conceded any benefits to the Smart City project. In fact, the promoters stand to benefit in terms of land prices and other concessions. However, one cannot say for sure that Mr. Achuthanandan could have struck a better deal under the given circumstances.

Some people in the Government opposed to Mr. Achuthanandan is now trying to create confusion that the terms of the new SEZ policy applied to Smart City. Even if the policy statement says so, it cannot override the terms of the agreement signed by the Government. Otherwise, the Government has to do so through legislation. Such a retrospective application of legislation to nullify benefits promised to entrepreneurs, that too within a short period, will send the wrong signals to investors.

There is indeed the need to bring down concessions being offered to the industry under the Information Technology policy. The concessions are often higher than what the State would get in return, especially when tax breaks are offered in addition to subsidy. So, the SEZ policy is a step in the right direction.

Smart City Project area

Smart City Project area


Government’s arguements

Oomen Chandy’s arguments