Even PMO cant get DDA to clear Rs 40,000-crore Dwarka project

Written by Rajat Arora | New Delhi | Updated: Aug 16 2013, 08:28am hrs
A Rs 40,000-crore exhibition-cum-commercial centre, which includes an air cargo complex, spread over 144 hectares near New Delhis IGI Airport in Dwarka Sector 25 & 26 has been held up for over a year, with the Delhi Development Authority (DDA) refusing to comply with instructions from the Prime Ministers Office (PMO) as well as its line ministry, the ministry of urban development.

The complex is proposed to have 2 million square feet of exhibition halls, a 6,000-seat convention centre, commercial office space, an air cargo complex, 3,500 hotel rooms and a multi-purpose arena with a capacity of 18,000.

While the DDA initially wanted to develop the project, it later wanted a share of its equity, which the government decided would instead be executed by the Delhi Mumbai Industrial Corridor Development Corporation (DMICDC) a quasi-government entity largely funded by Japan. The DDA wants the land to be transferred at commercial rates while the DMICDC argues this will kill the project. Ironically, despite several high-level meetings and promises by the DDA, the issue has still not been resolved.

DDA vice-chairman D Dipti Vilasa, who is also additional secretary in the urban development ministry, said he could not divulge any details of the deliberations and added: Whenever it is finalised, we will let you know. Saurabh Chandra, DMICDC chairman by virtue of being the secretary in the Department of Industrial Policy & Promotion, said: We are in touch with the urban development ministry on the issue for quite some time now. They have to get back to us on the rate at which the land will be transferred to the state SPV from the DDA. Apart from this, DDA will also have to change the land use before it gets transferred; so, we are waiting for that. DDA principal commissioner (land) T Srinidhi refused to provide details when contacted.

The Dwarka saga began in November 2010 with talks on starting a detailed techno-economic feasibility study by the DMICDC in consultation with DDA. There was then a discussion on whether the facility should be split into two, with one being developed by the DDA and the other by the DMICDC. Once the DMICDC did the detailed feasibility and engineering designing along with global expert AECOM, the project began to pick up steam and, on February 8, 2012, a decision was taken by the principal secretary in the PMO that the project would be developed as an integrated one, and by the DIPPs DMICDC with, if needed, the governments viability-gap funding.

DDA, however, pressed for being given an equity share in the project with the land being considered its contribution. No decision was, however, taken on the DDA proposal.

In another meeting with the principal secretary on May 10, 2012, it was decided that a call would be taken on how the land was to be priced and, if need be, the matter would be referred to the Cabinet. A decision was to be taken by the urban development secretary within a month.

Accordingly, on May 23, 2012, a meeting was held by the lieutenant governor, the ex-officio chairman of the DDA. At the meeting, Chandra pushed for early transfer of the land to DIPP and to fix the price at the much lower government-to-government rates. At the end of the meeting, it was reiterated that the DIPP would develop both parts of the project as an integrated one and that all the land shall be transferred by DDA to DIPP on government to government transfer policy.

On September 4, 2012, the matter was reviewed by the urban development minister, to whom the DDA reports. The decision on transferring land to DIPP on government rates was once again reiterated.

On October 9, 2012, at a meeting held by the urban development minister, the DDA vice-chairman did a U-turn and said the DDA would like to develop the project on its own and, if this was not acceptable, wanted to be an equity partner. The DDA vice-chairman also said it would be a good idea to remove the air cargo complex from the project and let the DDA develop it. The minister then decided, again, that the project would be developed as an integrated one and that the land would be transferred to the DIPP as per the rules for government-to-government transfers. A deadline of 15 days was given for this.

On December 31, 2012, the principal secretary held another meeting. At the meeting, however, the DDA vice-chairman said the land would be transferred at government rates but with the proviso that it was not used for commercial purposes. If the land was to be used for commercial purposes, he said, it would have to be auctioned as per the rules.

In other words, back to status quo. It was then decided that the matter would be resolved by the urban affairs secretary, including going back to open the issue of whether DDA should have equity in the project. By March 31, the PMO was to be informed of all progress on the project.

By May 24, 2013, the necessary meetings were held and, at a meeting with the principal secretary, the DDA vice-chairman said the land would be transferred to DIPP within six weeks at government-to-government rates. That still hasnt happened.

(with inputs from Timsy Jaipuria)