Centre cancels Rs 52 crore Gulbarga Textile Park

Centre cancels Rs 52 crore Gulbarga Textile Park

Railway Division Office in Kalaburagi was sanctioned by Mallikarjun Kharge. (DH Photo)

The union government which has been dragging its feet in establishing a Railway Division Office in Kalaburagi, sanctioned by Mallikarjun Kharge when he was the Minister of Railways, has given a shock to the people of Kalyana Karnataka by cancelling a Rs 52-crore Gulbarga Textile Park sanctioned in November 8, 2011, under the Scheme for Integrated Textile Park.

If the park had been established, it would have generated 4,315 jobs. Replying to a question by KC Ramamurthy on the establishment of the textile park in Rajya Sabha, the textile minister has clarified that this project has been dropped. The issue has also been discussed at length at the Project Approval Committee meeting on December 3, 2019. The slow pace of work resulted in the cancellation of the project, the minister explained.

Out of 50 acres of land purchased for this purpose, it was proposed to establish the park on 47 acres at Nandur-Kesaragi Industrial Area. A total of 47 members were registered under the Special Purpose Vehicle (SPV), under which the park was to be developed. When the park was sanctioned, it was proposed to establish about 100 units, but later it was brought down to 50 units.

DPR revised

According to the sources, the revision of the Detailed Project Report (DPR) is said to be the main reason for cancellation of the project. As per an inquiry report which DH has in its possession, the total project cost proposed in 2009 was Rs 52.10 crore, whereas the revised project cost submitted in 2014 was Rs 83.04 crore. Without following rules, tender has been awarded for a higher rate. Instead of Rs 6.2 crore initial project cost, work order has been given for Rs 8.87 crore, the report said.

An inquiry team that probed into the irregularities in the management of Gulbarga Textile Park found that Gulbarga Textile Park Private Limited has failed to collect equity share of Rs 7.85 crore (15%) so far from the members.

Gulbarga Textile Park Private Limited Managing Director Subhash Kamalapure told DH that the government has cancelled the project as they failed to collect equity share.

“We will approach the Centre seeking time to collect the same and to withdraw the cancellation order,” Kamalapure said. Regarding the revision of the DPR, he said, as per the original DPR, the project cost was Rs 52 crore. In the revised report, we have brought down it to Rs 48 crore,
he explained.

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