UDF government failed to safeguard interest of Kerala: Vizhinjam Judicial panel

The commission questioned why the government should permit a private company to mortgage government land when the project is funded by the government itself.

Published: 14th March 2018 05:39 AM  |   Last Updated: 14th March 2018 05:39 AM   |  A+A-

Construction of the breakwater for the Vizhinjam seaport in progress at Vizhinjam-Mulloor region  Kaviyoor Santhosh

By Express News Service

KOCHI: The Vizhinjam Judicial Commission, at its sitting on Tuesday, observed the government had failed to safeguard the interest of the state while entering into various agreements as part of the Vizhinjam port development project with the Adani Group. Chairing the commission, Justice C N Ramachandran heard from former Port Secretary James Varghese about the various agreements between the UDF government and the Adani Group. The commission came across a mortgage agreement signed between the company and the government, and found it very unusual. 

The commission questioned why the government should permit a private company to mortgage government land when the project is funded by the government itself. On this, the counsel appearing for the Adani Group submitted in other similar projects, the same method of mortgaging is permitted. This is done to avail loan from banks. The Adani Group also stated no land reserved for the port project has been mortgaged till now. On this, the commission asked why could the government not add a clause in the agreement preventing the private company from mortgaging the land. 

The commission was surprised to see 30 per cent of the land was provided to a private company for developing a commercial establishment. The commission asked whether the company could use this land for real estate purpose. Another point of debate was about the ‘Basic Engineer Cost’ report prepared by AECOM, an international company. In 2013, AECOM filed a report estimating the basic engineering cost at around `631 crores. 

The same company filed another report in 2015 in which the cost was hiked to `934 crores. 
In the CAG report, it was claimed an inflation of 5 percent can take place annually, but a 50 per cent hiked cost was highly unusual. On this, the commission asked the government pleader to produce both the reports by AECOM and find why such a hike was reported. The commission will continue its sitting on Wednesday.

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