Kerala's major projects jinxed

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“I do not have the courage to bring new projects to Kerala”, was how Defence Minister A.K. Antony on Wednesday described the present industrial climate in Kerala. He made this scathing attack against the state government for not taking the initiative to push mega projects, and delaying the ones already sanctioned.

Leaving aside the political overtones in the statement, the major dream projects of the state, all in the public sector or under the private-public partnership mode, have somehow got stuck and reached nowhere.

Incidentally, it was just a month ago that the state embarked on a major initiative to tell the world its capabilities through Emerging Kerala. The three-day conclave went into details of the strengths and weakness in different sectors.

But even as all this is on and the government hopes to go ahead with fresh projects, the big ones still appear stuck and it certainly is not on account of the tag that the state has militant trade unions and is not investor-friendly.

It took more than two decades of planning, inviting tenders and cancelling them to finally get the dream project of the country’s first international container transshipment terminal commissioned in 2011.

But the over Rs 3,000-crore terminal now is like any other terminal in the country. It was to overcome this that the state launched a campaign to get some of the age-old laws changed.

And finally, the Union Cabinet decided to relax the cabotage law which would not allow foreign vessels move between domestic ports after the main business at the transshipment terminal.

The relaxation should have given the terminal an advantage as it would have allowed vessels from abroad to move out from Colombo and make it to Kochi which is closest on the international maritime route.

When things appeared to move smoothly, came the Union defence ministry’s concerns over national security, suddenly taking the winds out of its sail. It has suggested that all cargo, incoming and outgoing which already pass a customs clearance, should be scanned again.

This will only delay transshipment and give competing ports like Colombo or Singapore or Dubai an added edge.

Another transshipment terminal project at Vizhinjam near Thiruvananthapuram has regularly run into rough weather with tenders and re-tenders. With the project was planned a shipyard. But the project plan has made little headway.

The other major dream was to energise the state with LNG. Petronet LNG Ltd, decided to set up a regasification terminal at Puthuvype, near Kochi, at an investment of more than Rs 4,000 crore.

The project is on the verge of being commissioned but there are no takers for this gas which is costly.
Some of the buyers like FACT, BSES, TCC, etc appear to have developed cold feet.

The biggest captive buyer NTPC is nowhere in the scene and according to Petronet officials, without a minimum offtake the project cannot take off.

It was planned in the late 90s but Dahej in Gujarat pipped Kerala and the project is on in full steam there. An agreement with Qatar-based RasGas for around $ 3 a tonne was for both Kochi and Dahej with the latter now taking full benefit.

Industry department sources said the issue would be taken up with Petronet as the price of gas to be sourced from Australia for the state was now being quoted at around $ 15.

The jinx keeps haunting the Rs 4,300-crore gas pipeline to be laid by GAIL. Of the 900-km pipeline to be laid up to Bengaluru via Mangalore, hardly 4 km has been completed.

Additional chief secretary in the industries department V. Somasundaram said that the right of use of the land where the pipes were to be laid had been brought down and compensation based on fair price had been fixed which should make matters smooth.

GAIL officials say that there is the threat that the pipeline from Gujarat to Bengaluru could be extended to Mangalore via Tumkur in Karnataka which will deny the northern parts of Kerala the much-needed pipeline that can meet the needs of industries and also domestic consumers. This will also fetch the state exchequer a handsome revenue.

The jinx keeps following the dream project of the Rs 5,100-crore Kochi Metro which was initially proposed to be handed over to the Delhi Metro Rail Corporation. But the latter’s disinterest in taking up projects outside Delhi Metro has left things in a state of flux.

The information technology initiative, SmartCity, in Kochi which had run into controversies for long finally saw the foundation stone being laid in 2011. But the project which promised around 1 lakh jobs has made little progress.

Here again, it has been the lack of co-ordination between the various agencies involved in getting things cleared to give it the push.