Lost Expressway Part I: Rasta Roko, courtesy Gowda

Raasta Roko courtesy Gowda
Cong’s Big Brother in Karnataka Deve Gowda got Infosys chairman N R Narayana Murthy to quit the Bangalore airport consortium this week. Here’s some cold comfort for Infosys: India’s first private project to build world-class expressways to decongest Bangalore is close to taking off but is being terrorised by Gowda. And partner Congress can only watch. The Sunday Express investigates why

The Indian Express

BANGALORE, OCTOBER 22 : An hour from the manic congestion of Bangalore’s heart, construction teams are blasting rock and paving stretches to desperately complete the first phase of a 164-km string of expressways and five townships that will eventually sprawl across an area the size of Singapore—all the way up to Mysore.

The first glimpse of the promise of the Bangalore-Mysore Infrastructure Corridor will be evident in December: An 8-km sliver of expressway connecting two critical arterial roads out of Bangalore will be opened—a nerve-wracking hour-long drive of 23 traffic signals should become a five-minute glide.

Costing over Rs 2000 crore, this is India’s first private infrastructure project to build inter-city expressways combined with world-class townships. So the government should be abuzz. Hardly.

Ask Chief Minister Dharam Singh when this project might be ready? Over the next six years—if it happens. ‘‘Ek din mein to nahin hota?(it can’t be done in a day),’’ said Singh.

The entire 64-km first phase—linking all of Bangalore’s main highways along which the ever-expanding but immensely frustrated tech industry is located—could be ready by the summer of 2006. But Singh and his government don’t want to talk because they fear the wrath of their powerful partner: former Prime Minister H D Deve Gowda.

Infosys Chief mentor N R Narayana Murthy is irked and hurt by land-grab accusations and ridicule from Gowda, but Murthy can perhaps console himself that he’s only now become a public target—and not yet an outcaste.

Ask Ashok Kheny what it’s like to attempt building 175 km of expressways from Bangalore to Mysore, embellished with five townships, a 400 MW power plant, water and sewage systems—while being an outcaste.

‘‘I can tell you this, if I had to do this again, no amount of money would entice me to do so,’’ the normally voluble, bustling Kheny, managing director of the Nandi Infrastructure Corridor Enterprise, said warily, as his project’s future readies for denouement in the Supreme Court next month.

It’s been eight years since the signing of the formal constitution of the project (the final framework agreement). Paralysed by Kheny’s bruising public battle with Gowda, but now fearful of the impending court judgement, the state last week started releasing stalled swathes of the 6,200 acres needed to throw open the Rs 830-crore first phase.

Now, here’s the irony: it was Gowda, who as chief minister in 1995, had cleared the project aimed at decongesting Bangalore.

‘‘I told them in 1995 that Bangalore’s brainpower would be worth $ 10 billion a year,’’ said Kheny, a Kannadiga and 23-year resident of the US who is, however, adept at working the Indian system. ‘‘They laughed at me. They said, ‘it’s your money, your risk. I agreed.’’

But Gowda—the controlling partner in Karnataka’s coalition government—has got the state to do volte faces in court, try to renege on signed agreements and drop the project from the city’s desperately needed infrastructure plans.

Mention the name Kheny and Gowda’s face contorts in anger. ‘‘Does he think he can carry on a real-estate business, cheat poor farmers and get away with it?’’ Gowda raged when this reporter met him. ‘‘Let him build the road but he is not building. Who is stopping him?’’

The years of battle with a powerful politician have sent Kheny’s partners scurrying for cover. The main promoter of the Nandi project is the Kalyani Group from Pune, a premier Indian global company with a big appetite for buying up auto-component firms across Europe.

‘‘I have nothing to do with this,’’ Kalyani Chairman and Managing Director Baba Kalyani told The Sunday Express. But about Rs 210 crore of the Rs 350 crore equity is his money. ‘‘That maybe,’’ he said. ‘‘But I have not even seen the project (he did fly down to see it after this conversation). Mr Kheny is the best person to talk to.’’

Nandi’s consortium of backing banks—ICICI accounts for a fourth of Rs 200 crore lent; others include Central Bank of India, Punjab National Bank, State Bank of Patiala and State Bank of Mysore—refused public comment but freely expressed their admiration.

‘‘One must hand it to Nandi for patience,’’ said a bank official. ‘‘There is no project like this in India, no one to look up to for advice, hats off to them for perseverance...there are a lot of issues that must be handled.’’

Though the Supreme Court’s last order in July said, for now, Nandi could not sell acquired land, this is an accepted international model of creating viable expressway projects. If that route to raise money is permanently blocked, the Kalyanis and Kheny (he’s brought in about Rs 140 crore) will have to bring in more money.

‘‘He (Kheny) has to show us how he can get equity and the land,’’ said a banker. ‘‘But we believe these are last-mile problems. The worst is behind this project.’’

However, without state backing, Kheny struggles with investments for the townships. He’s now talking with potential investors in India and Japan, but there are no commitments. ‘‘No one is willing to put money into Nandi right now,’’ said Ramani Shastri, president of the Confederation of Real Estate Developers’ of India. ‘‘I would like to see the expressway done. Then, the projects are doable and bankable.’’

Yet Shastri, like so many experts, lauds the Bangalore-Mysore Infrastructure Corridor as the harbinger. ‘‘I would ideally want this to be scaled across India,’’ said Shastri. ‘‘It’s a great model to replicate, but you have first divest development from politics.’’

If only it were that simple.



The Long Road


4 CMs. 10,500 government approvals. 18 laws amended. 20,000 land-holders being compensated. 10 years—and still counting

Feb ’95: CM Deve Gowda signs MoU with Governor William Weld of Massachusetts, US. Consortium includes two US companies and Kalyani Group, envisages expressways and 7 townships

Nov ’95: Government orders aquisition of 18,313 acres for expressways and five townships

Jan ’96: Nandi Infrastructure Corridor Enterpise is formed as project implementation company

April ’97: Final framework agreement signed with Janata Dal Chief Minister J H Patel. Land requirement increased to 20,193 acres

’98-’03: Public hearings, environmental clearances, toll-franchise and land lease agreements signed. Dharam Singh is PWD minister

December ’03: Just before Karnataka elections, Deve Gowda accuses Nandi of being a ‘‘real-estate business’’, demands return of 2,500 acres of
‘‘excess land’’

March ’04: Construction begins in patches with only 1,035 acres handed over to Nandi

November 2004: Pressured by Gowda, new JD-Cong govt forms team that echoes his claim: 2,500 acres are excess, Cabinet accepts report

Jan 2005: Karnataka HC quashes reviews of the project, orders prosecution of Chief Secretary for perjury. State goes to Supreme Court

July 2005: SC lets work go ahead, tells Nandi not to sell land. Final order likely in Nov