Gowda manages to scuttle BMIC

Bangalore-Mysore corridor project under the scanner
The Hindu Business Line

Conceived in 1994-95, the Rs 2,200-crore BMICP co-promoted by the Kalyani group achieved financial closure in March this year and began construction on phase 1 in a course beset with legal and other hurdles.



THE Bangalore-Mysore Infrastructure Corridor Project (BMICP) has been put under the scanner.

The Karnataka Cabinet today named a committee to probe allegations of irregularities and deviations in the project.

The committee headed by Mr K.C. Reddy, retired engineer-in-chief and adviser to the public works and energy departments, would be asked to submit the report in a month's time.

The probe team would include officials from the Finance, Urban Development, Public Works and Industry & Commerce departments, the Revenue Minister, Mr M.P. Prakash, told a news briefing.

Conceived in 1994-95, the Rs 2,200-crore BMICP co-promoted by the Kalyani group achieved financial closure in March this year and began construction on phase 1 in a course beset with legal and other hurdles.

It involves a 40-odd km peripheral road, a 111-km toll expressway up to Mysore and five townships along the way.

The decision comes in the wake of allegations principally from the Janata Dal (S) leader, Mr H.D. Deve Gowda, that the project was more a real estate proposition and that there were violations of the framework agreement of April 1997 in respect of quantity of land acquired, road alignment and also in securing bank loan by mortgaging land allotted to it.

Reacting to the development, the Managing Director of the promoter consortium Nandi Infrastructure Corridor Enterprises Ltd, Mr Ashok Kheny, told Business Line that he had sent a 10-page letter to the Chief Minister, Mr Dharam Singh, in support of the project.

Mr Kheny said the project was, for five years, under the purview of Mr Dharam Singh who was the PWD Minister in the previous S.M. Krishna government. The High Court and the Supreme Court, he said, had upheld all clauses of the framework agreement of 1997. No land was mortgaged, no alignment was changed and there was no violation of any sort.

"In a long gestation period like this, we cannot be held hostage whenever the Government changes; we are not afraid of review but the framework agreement cannot be touched now," he said.

The company has, so far, been allotted 1,035 acres of land for phase 1 at the Bangalore end. The company has spent Rs 300-Rs 400 crore towards land acquisition and KIADB charges. The entire project needs over 20,000 acres of land, mostly acquired from farmers and private holders.