KOCHI: In a quiet move, the trouble-torn SmartCity-Kochi has settled the dispute with Synergy Property Development Services by paying compensation, including legal expenses, to its Bengaluru-based project management consultant (PMC) which had dragged the IT Special Economic Zone into insolvency proceedings over a payment default.But the troubles faced by the Kakkanad-based SmartCity-Kochi seems far from over as the deal was done without taking its board of directors into confidence.
Sources told Express, as per the out-of-court deal with Synergy which filed a case against SmartCity-Kochi in the National Company Law Appellate Tribunal (NCLAT), dues worth Rs 1.58 crore will be paid to Synergy, which in turn agreed to forgo the interest component. SmartCity-Kochi will also reimburse the legal expenses incurred by Synergy "in full".
The SmartCity-Kochi has been hitting the headlines for all the wrong reasons following the restructuring at Dubai Holding, which also saw the unceremonious exit of Baju George, the managing director of SmartCity-India and CEO of SmartCity-Kochi. The IT SEZ had Tecom Investments, a subsidiary of Dubai Holding, owning 84 per cent while the Kerala Government held remaining 16 per cent. Later, TECOM Investment as an entity was abolished, and the entire 84 per cent equity stake was transferred to Dubai Holding.
Manoj Nair Is new COO
It is learned that Manoj Nair, who has been appointed the Chief Operating Officer (COO) of SmartCity-Kochi, is likely to reach out to contractors and consultants, most of whom are unhappy with the work in progress at the IT SEZ."We had an issue with disruption of water supply, and there is no one to address the issue on the ground. Even for replacing a broken table, they need permission from Dubai. It's very difficult to work in such a scenario," said an officer in an IT firm having operations in the SmartCity in Kakkanad.
When contacted, Yusuff Ali of Lulu Group said he was a special invitee appointed by the Dubai Government in SmartCity-Kochi and not a full-time board member. "As long as they (the Dubai Government) need my services, I will continue in that role," he said, refusing further comment.
Lack of business plan
A consultant for SmartCity-Kochi said a lack of business plan and strategy affected the IT SEZ right from the beginning. Compounding the problem is the downturn in the IT sector resulting in large-scale layoffs in all major software companies. "The emergence of artificial intelligence, cloud computing, machine learning, 3D printing etc have disrupted the existing business model," he said.
"SmartCity-Kochi needs to rework its strategy with this in mind. The success and rapid growth of any IT/ITeS Park lies in getting one or two large anchor tenants. Then you build the park around it."