Snag hits Bidadi project

Snag hits Bidadi project
By P M Raghunandan, DH News Service, Bangalore:
The much-hyped Bidadi Knowledge City project seems to be on the rocks.

The State Government and the project developer, Delhi-based real estate major DLF Universal, are locking horns over finalising the Development Agreement for implementing the mega project estimated to cost Rs 50,000 crores.

Reason: The developer wants certain modifications to be done in the Development Agreement that was reached during H D Kumaraswamy-led coalition Government. It wants to hold the rights to claim liquidatory damages in case land acquisition process is delayed, rights to sub-lease the land openly and payment of development premium to be based on progress in land acquisition.

Result: The Government is not too keen to agree. In fact, it has directed the Law department to review these suggestions.

“We have asked the Law department to review it thoroughly. Suggestions made by the developer for modification will definitely have implications...Development Agreement is a legal document...We need to protect the interest of the State,” said S Krishnakumar, Advisor to the Governor. He held a meeting with Bangalore Metropolitan Region Development Authority (BMRDA) and Urban Development department officials in this regard on Thursday.

Official sources in BMRDA said the developer is not very confident about smooth land acquisition for the project. “It fears that the Government may face protests by local farmers and there are chances of the process getting delayed, leading to cost overrun. Hence, it wants to safeguard itself in the agreement,” sources pointed out.

So much so that the developer has so far not formed a consortium to implement the project. “The company wants to know the Government’s response to its suggestions for modifications, before roping in other players to form the consortium,” sources explained.

The mega project needs around 9,000 acres of land, of which, around 5,100 acres will be agriculture land in Bidadi -- roughly 30 kms from Bangalore city. The Government has to acquire the required land for the project, while the developer will implement the project, which is aimed at creating much-needed space exclusively to IT and BT industries.

Krishna Kumar further said the developer was well aware of the agreement and conditions that had been laid down before bidding for the project. “We could have straight away told them that we will not consider. But we have not done it. We want to see whether the modifications can be accommodated without sacrificing the interest of the State,” he stated.

The developer has now taken time to form a consortium. The Government, therefore, has enough time to look into the matter carefully. “At the same time, we will prepare for the preliminary notification for land acquisition...We will see what the Law department had to say,” he added.