SKIL Infrastructure Limited, promoters of the proposed controversial Special Economic Zone at Nandagudi near Hoskote, has indicated willingness to prune the size of the project that originally envisaged a staggering investment of Rs 15,000 crore if the situation warranted.

Having created a controversy in Karnataka within a month of getting a clearance from the Kumarswamy-led Government, SKIL Group Chairman Nikhil Gandhi, in an interview to Deccan Herald,  said against the land requirement of 12,350 acres spread over 36 villages for this project, the state government has only 4,745 acres of its own and the remaining 7,605 acres will have to be acquired from the farmers in those villages amicably – a task easier said than done.

"We can even modify the project in accordance with the land at our disposal and go for a mini version of whatever we had planned on a mega scale," he added.

Replying to a question, he said "We can execute the first phase of this project straightaway from the Government land made available us. Once the local people are convinced of the economic activity this project would generate, then it should not be much of a problem to implement the second and final phase."

He was all for transparency in implementing the project which, according to him, could  contribute to creating the economic history of Karnataka.  "Agreed we’ve not got the Board of Approval clearance as yet, but that is merely a formality," he added, pointing out that the clearance was delayed for want of some clarifications being sought and that is addressed.

On the issue of farmers' lands acquisition, Mr Gandhi said "We are yet to approach farmers of Nandagudi for the purpose  as we have not reached that stage as yet.   We have only received a formal clearance to the project from the Karnataka Government."  The pre-project work itself would consume about a year's time, before the company can reach the stage of approaching farmers for the acquisition of land.

He held out an assurance that  "We will approach the farmers at the right time with the right compensation and also line up some projects for the farmers to be funded through micro-financing.   This micro-financing will also be done by our group companies."

He said SEZ will have "human face" and his group would not go against the wishes of the farmers there.   "We have not done that in the past nor we will do now.  For that matter, our track record in implementing infrastructure projects from 1990 onwards to 2005 should suffice."

Referring to the controversy about the project, he said  "I know too much mud is thrown at me and the project by detractors.  All I can say to them: they should get their facts right, before indulging in mudslinging."

TISS service

Giving an update on the project, Mr Gandhi said SKIL proposed to rope in the services of Tata Institute of Social Science (TISS) to do locational study and survey in those villages. All the clearances, including environmental impact, would have to be in place before any construction was started All this would take about 9-12 months.

As far as the conditions imposed by the Government, including one that any violation would result in immediate cancellation of the project, Mr Gandhi said he was not perturbed over any of them and he would fulfill all of them.
On the conditions imposed by Karnataka Government, especially about water shortage in the area, he conceded:
"It is quite a challenge for us. SKIL will scout for suitable  technology from either France or Israel , which are known for their expertise in water resource management like water harvesting and cultivation”.

When asked to comment on rumours of Kumaraswamy (Karnataka CM) family members having interest in the project, Mr Gandhi said: "We don't indulge in any such act which is against the philosophy of the company, promoters and the Board.   And our project can stand the scrutiny of any government."

SKIL has set out to execute the project through a special purpose vehicle (SPV) and it will have debt-equity ratio of 2:1.   SKIL will be providing all the capital, management and balance sheet support to this SPV.

Jurong Town Corporation, Singapore and Parsons Brinckerhoff of USA have been entrusted with the task of designing and master plans for the SEZ, while construction majors like Larsen & Toubro and Shapoorji Pallanji will be roped in to build infrastructure.

Break-up

Mr Gandhi also gave a break-up on the first phase of the project costing Rs 5,000 crore. Of this, land would account for a major share of Rs 2,550 crore.

This envisaged land leveling, drainage, water pipeline and roads -- both main and arterial.  Powerlines were to cost Rs 250 crore, ready-to-use factories (zonal models) Rs 1,200 crore, service apartments with 3-star hotels Rs 300 crore, entertainment comprising green lake, children world, dada-dadi  Rs 120 crore, restaurants & cafeteria (for working class) Rs 80 crore and welfare entities like schools (up to 12th class), six dispensaries, 300-bed hospital Rs 220 crore.

Besides, administration blocks, police station and SEZ Development Commissioner's office and public and government offices, street lighting and power would cost Rs 450 crore.