Tecom withdraws from Kochi SmartCity project as govt violates contract terms

Thiruvananthapuram: Dubai-based firm Tecom withdrew from the Kochi SmartCity project following violations of the contract conditions by the Kerala Government, revealed documents.

SmartCity managing director Khalid Al Malik sent a dozen letters to the government listing these violations. After adequate compensation, the government decided to terminate its agreement with Tecom upon realising that a legal battle would only lead to a setback. However, as per the official version, Tecom backed out as it could not meet the deadline for completing the project.

According to the documents, the agreement for setting up the project was signed by the state government, Infopark, Tecom Investments and SmartCity on May 13, 2007. A lease agreement for 246 acres of land was also signed in February 2011. However, Khalid Al Malik wrote several times to the government in 2022 that it had failed to carry out the complete transfer of land. The letters alleged that while some parts of the land were under litigation, others were unusable.

The government had also handed over certain isolated plots. Moreover, the real-estate developer abandoned the project after the government inordinately delayed a no-objection certificate, which caused severe financial losses.

There was further delay in issuing permission to cut trees on the project land. Meanwhile, the government announced measures encouraging other IT industries on land adjacent to the SmartCity, which affected the prospects of the project.

The SmartCity authorities completed the first phase in 2016, overcoming all these hurdles. However, a government order issued in June 2020 was shocking and disappointing, said one of the letters. This order dealt with the alignment of the proposed SilverLine semi-high-speed railway project, which passed through the SmartCity land. The letter pointed out that the SilverLine alignment would devalue the SmartCity project.

After failing to respond over 10 months, the government replied that the SilverLine alignment could not be changed.

Soon, the government realized that Tecom could go to court against it for contract violation and sought legal opinion. However, there was another delay, leading to intervention by the Kerala Chief Minister, who appointed a high-power committee to study the issue. The committee, with the Chief Secretary and Secretaries of three departments as members, recommended termination of the agreement with Tecom after paying compensation.

The law secretary and the advocate general noted that the government could make a suitable decision based on this recommendation. None of these officials suggested legal measures because the government itself had violated the terms of the contract.