Real Estate War Open ! Cong's Controversial Projects Likely To Go Under Scanner

Date : Dec 10, 2013

JAIPUR: Transition to a new order or regime is usually never smooth and it's not going to be seamless either for some industrial projects approved in a hurry due to the state elections. As the BJP is set to take charge of the government, such projects are most likely to come under review.

During the election year, Ashok Gehlot announced many projects promising job creation and development to strike a chord with the voters. The refinery in Barmer was not only the biggest but the most controversial of them all.

The political intent behind the project was neither lost on the people, nor on Raje, who during the election campaigns, had already raised serious objections to the project. She said there is no reason for state government to make most of the investments when it is not the majority stakeholder.

"Governments will come and go but the broad decisions taken will remain unaffected. However, it is likely that those projects which have been approved keeping in mind the elections will come up for review," said M L Mehta, former chief secretary of Rajasthan government.

There is a view that there is no need for the state government to provide HPCL interest free loans of Rs 3500 crore every year for 15 years. The government can buy equity instead.

Just before Gehlot took over in 2008, there were some big-ticket projects for which the Raje government had signed MoUs. One of them is Rs 1,000 crore Saint Gobain glass manufacturing unit in Bhiwadi. After Gehlot came to power, it took about three years for the company to do a ground breaking ceremony. Issues were also raised on the Mahindra World City Jaipur.

Similarly, in the run-up to the elections, Gehlot has approved big projects allotting hundreds of acres of land in and around Jaipur. Whether these projects will be subject to political witch hunting or allowed to develop without any pressure will be seen in coming months.

One sector betting big on Raje is real estate. The widespread perception is that the real estate sector will see a massive boost if she forms the government. In fact, industry watchers say the sector witnessed its first boom years back during her regime. Today, the state doesn't have a single window clearance facility for the sector, which requires a long list of approvals.

"About 25% of the projects are stuck in the absence of approvals. Authorities responsible for environment clearance take five-six months for a meeting to approve the project. Again, the real estate sector is not a pollutant industry, but still it requires clearance from the pollution board. Every time these bodies meet, they leave further queries, which only delays projects inordinately," said Anurag Sharma, who represents Confederation of Real Estate Developers' Association of India for Rajasthan.

"We rely on Raje to ease the difficulties being faced by the industry," said Sharma, adding, "She has a reputation for fast tracking project approval process."

Rajasthan is a leading producer of wind power in the country but there has been almost no addition in the fresh capacity in the state in 2013. The Gehlot government's policy to opt for auction instead of the allocation method prevailing earlier has made producers face a setback. The wind power producers have gone to court and the impasse has dried up fresh plants.

After taking over, the Gehlot government discontinued Raje's resurgent Rajasthan initiative which gave the state a platform to showcase its opportunities for investment before the who's who of India Inc. The industry expects the initiative will be back with Raje coming to power.

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