Mumbai: The Smart City project in Kerala that envisages establishing an exclusive IT zone near Ernakulam, may finally become a reality with the state cabinet on Thursday finally approving the draft agreement to be signed with the Dubai Technology and Media Free Zone Authority (TECOM), the company implementing the project.

The cabinet has approved all terms except the one related to freehold on 12 per cent of the 246 acres of land acquired for the Rs1,500 crore project. The government has invited TECOM representatives to the state before 30 April to ink the agreement, chief minister V S Achuthanandan said.

The chief minister has been authorised by the cabinet to take a suitable decision on this and other related issues before signing the agreement.

The draft agreement envisages construction of 8.8 million square feet of built-up space, of which 70 per cent would be used solely for IT and IT-related activities. The remaining 30 per cent can be used for commercial purpose.

The project is expected to generate 90,000 jobs within ten years.

The government will have 26 per cent stake in the joint venture company to be floated for implementing the project. The government will initially get 16 per cent shares. The remaining 10 per cent will be given within 5 years, the chief minister said.

The government will have two members, including the chairman, in the ten-member board of directors. The number will go up to three when the government gets 26 per cent share, the chief Minister said.

Shortage of space has been a constraint for IT companies looking to set up shop in the state and the creation of over 6.1 million sq ft built-up space in the Smart City is expected to meet the demand to a certain extent.