labels: economy - general, it news
Kerala CM defends Smart City projectnews
Our Economy Bureau
18 May 2005

Kochi: Kerala chief minister Oommen Chandy has defended the Smart City project in a four-page article circulated to the media on Monday, saying that he found "nothing wrong in being a little smart for the sake of creating job opportunities in the State".

He said he had visited the Dubai Internet City (DIC) during his visit to the Gulf countries in April this year. "It is the confluence of all the leading names in the IT industry in the world: a dreamland for IT professionals across the globe. Several of the professionals who work there are from Kerala."

"On my way back to the state, I had the dream of such an institution coming up in Kochi. Over 20,000 engineers pass out of our professional colleges each year. I dreamed about jobs for them in our own state and jobs for several thousands more in allied sectors," Chandy said.

The state government does not have the financial capacity to invest R1,500 crores in a project like the Smart City. The income generated by the IT companies in the state comes to just Rs300 crores a year. States such as Karnataka, Andhra Pradesh and West Bengal, which had started IT parks with private and foreign funding, have already forged far ahead.

Chandy said it had taken some hard bargaining lasting nine months for the state government to strike a general understanding with the DIC on setting up the Smart City project in Kochi. Of the 300 acres of land being allotted for the project, only 100 acres were being given free of cost, that too purely on the basis of the IT policy of the State. The IT companies that would be brought to the Smart City would not get any other concession.

He said the DIC had given a commitment to create 33,000 jobs in return for the free land being given for the project. The employment benefit would be to the tune of Rs33 crore a month by way salary.

"The market value of the 100 acres being given for the project comes to Rs 20 crores. If, by making such a sacrifice, so many jobs can be created, it is by no means a bad deal." The total investment on the Infopark built by the state government and 62.27 acres of its land (which forms part of the 300 acres being allotted for the Smart City) is less than the price of Rs109 crore fixed for the property during the negotiations with the DIC.

A part of this amount is to be adjusted against the state government's nine per cent equity participation in the Smart City project. For the remaining 136 acres being allotted for the project, the DIC will pay Rs36 crore, which works out to Rs26.50 lakh an acre. This is purely based on the existing land value in the area.

He said the Smart City would be a joint venture between the state government and The Electronics Commerce and Media Zone Authority (TECOM), formed by the Dubai Government under an Act of its legislative body.


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Kerala CM defends Smart City project