Updates of T3 - October 30, 2009

Minister M. Vijayakumar speaks from inside the cavernous Terminal 3, approaching completion at the Trivandrum International Airport.

Video courtesy: Asianet; Link courtesy: Trivandrum Fast Forward

The Lankan Question

While the malayalam media has chosen to give much higher coverage to such weighty matters as the alleged mischief of the son of a minister or what another is twittering, an interesting article in The Sri Lankan Guardian brings to light how distant eyes are focused on the strategic issues in our midst.

The article talks of how Sri Lanka is aligning itself to new partners such as China and Iran in a variety of ways. Most interestingly it talks of how China is keenly interested in port development in Sri Lanka:

China, for its part, views Sri Lanka as a strategically vital gateway for securing access to shipping arterials in the Indian Ocean . Hambantota will be more than three times the size of Colombo harbour and is designed to serve as a Service and Industrial Port when fully completed, 14 years from now. It also has the potential to be developed into a major transhipment port. In addition, the port will be able to accommodate a new generation of mega-ships and is to include four terminals (12 berths), bunkering and refuelling facilities, liquefied natural gas refinery, aviation fuel storage facilities, bonded export processing zone and dry docks.As the main symbol of growing Sino-Lanka relations, the new Hambantota port (construction of which began in January 2008) will serve as a key transit point for oil and gas tankers accessing the Red Sea, Persian Gulf, Malacca Straits and the ports of Gwadar in Pakistan and Sitwe in Myanmar. Hambantota will also serve as a key maritime transit point to China ’s expanding investments among Indian Ocean island nations.

All that sounds familiar doesn't it - transshipment, arterial shipping lanes, transit point for oil and gas tankers? Everything which is mentioned about Vizhinjam. China has realised that even though it is inferior to Vizhinjam in proximity to the sub-continent and natural depth, Hambantota could become one of the premier ports in the Indian Ocean region, which along with the South China Sea/Eastern Pacific, would become one of the world's most active maritime regions.

The Guardian clear mentions that Vizhinjam is perceived as the top competitor to Hambantota. If only our folks realised this sooner rather than later.

Sri Lanka is said to have initially offered the project to India , which declined it for undisclosed reasons. One reason may have been political and commercial considerations, and India’s ambitions to upgrade its own ports in southern India , namely Vizhinjam, Tuticorin, and Cochin . Historically, there has been a fierce and longstanding rivalry between Indian and Sri Lankan ports, particularly Colombo , which dominates the region’s lucrative transhipment trade.

And it is clear that the Lankans are feeling the heat,

The Sri Lankan authorities are worried that the Colombo port might lose the advantages presently enjoyed by it vis-à-vis the ports in South India when the construction of the Sethusamudram Canal and the work of modernisation of the ports in South India undertaken by the Government of India is completed.’ Such views do much to put the Hambantota port issue in context -- the facility will diminish India ’s ability to compete.

 Sri Lanka has realised what India should have realised a long time back, that a world-class, deep-water port located on the tip of the sub-continent has the potential to dominate the Indian Ocean region (including the Arabian Sea and the Bay of Bengal) just as Singapore dominates the Malacca Straits and Hong Kong has dominated the South China Sea. That these are two of the world's leading ports is a fact not to be easily ignored. There is only one Indian port which has the location and the draught to fulfil this role and that is Vizhinjam, which is already the deepest port in the entire Indian Ocean.

India’s dilemma is compounded by Sri Lanka’s ambitions to harness its strategic location astride Indian Ocean shipping arterials, with Dr. Priyath Bandu Wickrama, Chairman, Sri Lanka Port Authority, noting: ‘Over 200 ships sail this route [daily] and we want to attract them… Our vision is to consolidate the position of Sri Lanka as the premier maritime logistic centre of the Asian region.’

Any further delay in developing Vizhinjam is now plainly at the risk of losing the numero uno maritime position in the region. The bounty of developing the Rs 8000 Crore deep-water port and transshipment terminal is clear, 200 ships already sail by daily with many more to come - one third of the world's maritime traffic, that is one heck of a bounty!

A Committe to rescue Mega-projects

Keeping with the line of the previous two posts, I was happy to find out that the Government of Kerala has a set up a High Powered Committee to examine causes for the delays in executing major projects and to suggest remedial measures. It is composed of the former Chief Secretary, Sri- V. Ramachandran and Dr. Jayathilak, Commissioner, Rural Development.

The objectives of the Committee include:

1. Review and suggest improvements for existing tendering and contracting systems

2. Identify and suggest remedial measures for organisational and process gaps in Government departments and agencies

3. Suggestions for expediting the Clearance of major projects

4. Improving Land Acquisition

5. Improve Project monitoring

The best part is that I have been invited to have a discussion with the Committee on the subject in view of my interest and experience in it. (I guess the blog's been going places, lol, or may be it was the publicity in The Hindu last week). 

I will be meeting the Committee sometime in early November and since many of you have come up with great suggestions on the topics I have written about, I request all of you to chip in with points and suggestions that need to be highlighted to the Committee. You can post them here or, better still, mail them to me when you get time. Let's put some thought to this, this is perhaps the best opportunity ever for the common man to have his say in the lofty game of mega-projects. Top marks to the Committee for its interest in what the public has to say. After all, the success of projects like Vizhinjam and Technocity will mean a lot to all of us and to everyone in Kerala in the years to come!

Getting more muddled......

In keeping with the media glare on the so-called "mega-projects", the New Indian Express has done a two-part expose on the shady dealings behind the Sobha Hi-tech City project which deals mainly with the setting up of shell companies and their links with the most-famous real-estate shark in Kerala, Sri Pharis Aboobacker. The setting up of shell companies is pretty normal to avoid the restrictions imposed by the Kerala Land Reforms Act, 1963, which prohibit anyone from owning more than 15 acres of land in Kerala. However, the clear links of these shell companies with Pharis and the way they have been set up is a clear raised flag, which calls the entire project into question.

The way that the project was planned in land classified under CRZ 1 also makes wonder if there were any sane minds involved in the land identification and acquisition phase. There has been a massive out-cry against the possible ecological damage.  Why doesn't anyone wonder why the project promoters look for some other parcel of land? There are plenty of 400 acre parcels even in the same district, not to mention the rest of Kerala, without having to encroach on to wet-lands and mangroves.

The final nail in the coffin is of course the fact the promoter itself is trying to sell the land off to repay its mounting debts. If they themselves don't want it, why is everyone else so bothered, I wonder?

I sure do hope that the lessons learned from this debacle will be put to good use in the future in weeding out undeserving applicants to the mega-project clearance process.

Project Muddles and Puddles......

Scanning the sheets of Kerala's dailies or surfing through reports on the many malayalam news channels that crowd the airwaves of God's Own Country over the last week or so, one would be forgiven that it is raining mega-projects in our State. There's been talk of half a dozen giant projects ranging from deep-water ports to huge IT parks. Totalling well over Rs 20,000 Crores (US$ 4 Billion) in investment and creating over 200,000 jobs between them. The only catch is that while some projects are on an upswing, others are heading south and overall the picture for development doesn't look too good.

After a year of going from bad to worse, Vizhinjam's stars seem to be shining brighter for a change. The State Cabinet has sanctioned an allocation of nearly Rs 450 Crores for the development of supporting infrastructure for the Rs 8000 Crore deep-water port and container transshipment terminal. This would primarily involve  the development of road and rail connectivity as well as the provision of electricity and water supply to the port. NHAI has already consented to build the 2 Km of road needed to connect the port site with the NH-47 while the Indian Railways are examining the proposal to build the 8 Km partly-elevated rail corridor to connect the port to the main railway line at a cost of Rs 180 Crores. Power and water would be supplied by the KSEB and KWA respectively for which moves are already afoot. And to top it off, it's been reported that the Maritime and Port Authority of Singapore (MPA) has expressed an interest in Vizhinjam. (Malayalam news link).

But while there is light at the end of the tunnel for Kerala's biggest infrastructure project, there is one mean and persistent shark still circling around. And entering on cue has been the bogey of this project, a company rather dramatically called Zoom Developers. After having managed to scuttle the last tender for the project through a protracted legal battle, it has now come back claiming that till its suit against the rejection of its bid is settled, the tender process cannot be restarted. They don't seem too confident of the outcome of that suit, since the company has simultaneously asked the High Court to include it in any upcoming bid! In the meantime, they have also managed to forget to attend the project meeting for their supposed project in Kalamassery which supposedly includes a 100-floor version of the tower of Babel. It's high time that the State conducts an investigation of Zoom's real motives and capabilities and black-lists them for once and for all.

Technocity, the other mega-project on the Government's list has also been having a less-than-ideal year so far, starting with the lack of response to its first outing due to the slightly poor timing - a week or so after the financial tsunami swept across the world in late September 2008. After dragging on for almost two years, the land acquisition for the 450 acre, Rs 6000 Crore project seems to be limping back on track, just in time as the IT business space market bottoms and rebounds from depths where billion dollar companies were committing hara-kiri by getting perfectly good IT SEZs denotified (I guess the Ministry of Commerce had to write the rules for that in a hurry!) In a sure sign that things are moving again, the State Cabinet approved the Rehabilitation policy for the Project Displaced Persons of the project. That this decision should have been taken 18 months ago is another matter, which would have avoided the delays in land acquisition due to public resistance. Of course, the powers-that-be would argue that there would have been little demand anyway, but the fact of the matter is that the bid for the project, conceptualised in August 2005, should have been held at least by March 2008. All this while, the interest on the Rs 350 Crores borrowed by Technopark from commercial banks for the land acqusition has started to accrue.

But the crucial missing piece is the marketing effort to get 450 acres and a potential 15 million sq.ft. of space absorbed by the market, which is still experiencing gluts in the Tier 1 markets. To garner the nearly Rs 6000 Crores needed to develop Technocity fully. The Government is still very much caught up in its day-dream of starting "IT parks" in every district and panchayath. While there is a simple strategy that can be adopted for building on the strengths of Kerala's IT/ITES industry till it is competitive at least on a national level before branching out, the Government seems oblivious to it, even when that strategy has been elucidated and door delivered to them. Indeed, there has been a pretty public round of back-slapping and mutual appreciation over the inauguration of the first tiny bit of the IT park at Koratty (Thrissur). I hope those who have been bowled over the speed with which the space was lapped up will remember that the sum total of that space is about 1% of Technopark today. At this rate, we will take about 200 years to reach where Bangalore is today, with a total 20 times the space of Technopark.

What is needed is the clear realization that while it is a political necessity to have an IT park, or at least a foundation stone of an IT park, in each and every district and assembly constituency, there must be clear prioritization and focus of effort to get the anchor projects such as Technocity, Technopark Phase III and the expansion of Infopark in progress. Otherwise, we will end up with a lot of spokes while the hubs wither away in the meantime. The commencement of work on Phase III is a step in the right direction. However, the Government does need to understand that only major projects like Technocity and Phase III can bring in the major IT firms, that in turn can generate the sort of numbers of jobs that are expected from the IT sector. To put things in perspective, it would take 8-10 district level parks to stack up against a Technocity-sized project. And there too, it is unlikely that any of the smaller parks would attract a high-quality investor like an IBM or Accenture who would demand the facilities of a major park.

The curious part is that the sudden impetus to push Technocity forward may be partly due to the expected demise of a project that has been the darling of a section of the media and an albatross around the neck of the Government for quite some time. Yes, I am speaking of that "City" alright. In an absolute inversion of Manorama's pet theory of June 17,2009, it now is likely that the death throes of the agreement with Dubai-based promoters could spur the Government on to push ahead more quickly with Technocity and other major projects so that their development scorecard reads okay on the whole. Similarly, a couple of other "City"s also seem to have bitten the dust, one on environmental grounds, the other because the High Court forbade any non-industrial use on land received from a PSU. Of course there is the risk that any investor landing up at Technocity, as in fact a number of domestic and global firms have evinced interest over the past few weeks (I had the chance to meet with the CEO of a top global developer in Trivandrum two weeks ago), may be sent packing northwards to stand in for the vanishing sheikhs. But on the whole, such debacles may get the Government to focus more on projects that are on a true PPP basis where it has a much greater degree of control and where the level of transparency is much better.

Now that we have realised that Kerala's "mega" projects are in some sort of muddle or the other, perhaps it is time to take stock of what worked and what went disastrously wrong.  Technocity's troubles have been primarily because of a lack of Government focus and the failure to operationalise KSITIL, the Special Purpose Company floated in 2007 to develop the project. "Smart" City ran into trouble when the promoters started paying more attention on the 12% of freehold land intended for residential development than to the 88% of leased land meant for developing IT space. Sobha bust its bottom when it ran into stiff environmental resistance because somehow it bought land right in the middle of a mangrove forest. So what can we learn?

1. Independent due diligence to be done by the Government even on private projects, if they are asking for major exemptions. No exemptions to be granted to critical environmental issues which could have been avoided at another location. This will also prevent a real-estate project like the Elbit-Salarpuria township being re-packaged as a "Knowledge City" to attract incentives. (The project involves only a couple of office towers, not an SEZ, and making up less than 20% of overall area, most of which is devoted to premium apartments)

2. PPP projects to be operated as profit-centers with a certain degree of administrative and financial autonomy.

3. A uniform policy to be created for the land-use in mixed-use developments. Today, the IT Policy spells out that 70% of land area has to be used for Processing (IT) use. This should be uniformly followed. Freehold not to be allowed in any PPP project with a significant Govt. equity holding and receiving major benefits (?)

4. Separate incentive policy for mass housing/townships being developed next to major industrial facilities. Incentives could lesser than those for the commercial/processing components. For example: 100% stamp duty exemption for processing facilities and 50% for the associated residential components.

5. A well located land bank is an absolute necessity.

6. A time-bound, mutually agreed schedule for the project with exit clauses and arbitration provisions if there is a major discrepancy in meeting milestones. This will prevent a repeat of the log-jam with the "Smart" City project where three years have been wasted in haggling and time-wasting tactics by the promoters.

Kerala needs major projects like Vizhinjam, Technocity and the expansion of Technopark and Infopark but we have neither the space nor the resources to let a plethora of wanna-be mega-projects run amuck. The best course of action is to weed out the unworthy projects even before they reach the Single Window Clearance or PPP stage and to focus all available resources on projects whose feasibility and viability are beyond question and which are firmly in the PPP structure. Then perhaps, even if we don't see 200,000 jobs being created in the next two years, we may see the figure reached within the coming decade. That, in itself, will be a momentous achievement for Trivandrum and Kerala.

On a separate note, this blog has received honorable mention in an article in The Hindu about blogs on development. Thanks to all of you for your support and contributions which have helped make Trivandrum Rising noteworthy!

Welcome to Zoom-in-Zoo

One of my best buddies, Arun, is leading an initiative to make the Trivandrum Zoo a more positive place both for its residents and its visitors. Rather than just being a place to see animals as static attractions, his idea is to project them as individuals with personalities so that they leave a more lasting and favorable impression on visitors, prompting better behaviour on their part as well as creating a more engaging learning experience.

A freelance photographer, Arun, is exhibiting a collection of photos he has taken of residents at the Trivandrum Zoo over the last couple of years with an emphasis to portray their personalities. He is also working with three young graphic artists to create animated characters based on zoo animals which will appeal more easily to children. 

The exhibition, Zoom-in-Zoo, will be the first in a series of initiatives planned by the bunch of young people to elevate the Trivandrum Zoo, the oldest public zoo in India, to world-class standards. Stay tuned for more!

Zoom-in-Zoo is on at the Zoo Auditorium from October 15th to 18th, 9 AM to 6 PM. See you there!

The Tale of Lost Projects......

A rare report in the mainstream media about major projects diverted from Trivandrum to other parts of Kerala. Do watch it to understand how we have been consistently been short-changed by successive State and Central Governments over the years.

Video Link

The Second Kovalam Literary Festival is here.....

The first Kovalam Literary Festival is quite memorable for me as it happened when I was enjoying a brief holiday at the awesome Taj Green Cove luxury resort and it was my first meeting with Dr. Shashi Tharoor. I had the chance to attend some of the readings by famous authors and meet some of the greats. 

Here is a slice of what is planned (excerpt from The Hindu) - "Noted litterateur Vishnu Narayanan Namboodiri is scheduled to inaugurate the three-day event at the Taj Kovalam on Wednesday evening. Actor Om Puri will be present to pre-release his forthcoming biography. Burmese dissident writer Ma Thida, who was jailed till 1999 for her pro-democracy writings, will read from her fiction. Amitav Ghosh, a big supporter of Burmese writing, will send a preface to modern Burmese writing which will be read out at the festival by Mukul Kesavan, author and commentator."

Ever a center of literature, arts and learning, Trivandrum is the perfect location to host a tasteful event like this and the Taj Green Cove provides a stunning venue for it.

Do take a look at the beautiful official website, which packs lots of information and photos of the current and past ensemble at the Lit Fest.

Finding a Twin!

No, I am not talking about one of those cliche movies where long lost twin brothers (Mr. Bachan has done a few of those) are united after 25 years when they matched up the broken halves of a convenient locket or something. I am referring to the ongoing initiative to set up a programme or agreement to develop a close relationship between Trivandrum and Barcelona, commonly referred to as "twinning".

The Director of International Affiairs of the Barcelona City Council, Mr. Josep Roca and Gerardo Fueyo-Bros, Cultural Councillor, Embassy of Spain in India, visited Trivandrum on September 30 and Oct 1 in an exploratory visit to better understand the context in Trivandrum as well as to identify potential avenues for cooperation.

TDF was actively involved in the two-day programme. We had an exclusive meeting with Mr Roca and Mr Fueyo-Bros where we made a presentation on Trivandrum to help them understand more about the city and its metropolitan area as well as about the City Corporation which would be the nodal agency from our end. I also had the privilege of accompanying them to Kerala's IT hub, Technopark yesterday. Detailed discussions were held with the Mayor of Trivandrum and his team over lunch before we had a dinner meeting hosted by the Trivandrum Chamber of Commerce where a fruitful exchange happened on possible areas of commercial relationships.

The team from Barcelona expressed keen interest in areas like the Knowledge Economy - especially IT/ITES, biotechnology and R&D, Urban Planning, Water Management, Sports Event and Facility Management, Ports & Logistics and Tourism.

Barcelona is a leader in Europe in the knowledge sector hosting major universities, research centers and business parks like 22@Barcelona where they find excellent synergies with projects like Technocity. It is also the biggest port in the Mediterranean region and a leader in the container and cruise segments which is one reason why the team was keenly interested in the Vizhinjam project. Having hosted the 1992 Olympic Games, Barcelona has extensive experience in managing major sports events as well as the sports facilities after the Games, which would be a boon to Trivandrum which is working double overtime to get the facilities ready for the 2011 National Games and to evolve a strategy to manage them sustainably after the Games.

Going forward, we will be working with the Corporation and other stakeholders to create a vision document to identify the possible avenues of cooperation between the two cities and the modalities to take the initiative forward in a time-bound manner. I look forward to hearing all your views and suggestions on the same. Thanks in advance, folks!