The Comptroller and Auditor General (CAG) report against the Vizhinjam project agreement must be viewed seriously, said chief minister Pinarayi Vijayan Wesnesday. Instead, it allows "undue benefit to the private partner" - the Adani Group. It could also be extended by 20 more years.
On Monday former chief minister VS Achuthanandan alleged corruption in the agreement signed with Adani group and demanded a white paper from the government on the status of the project. The state government would get a portion of the revenue from the port after 15 years of operations. Stating that standard concession period for the PPP project was 30 years and by allowing 10 years, extra concession period in the agreement for Vizhinjam, the Concessionaire (Adani Group) would be collecting additional revenue of Rs29,217 crore, based on revenue estimates in Feasibility Report by Ernst and Young.
The CAG has even found problems with the terminology in the concession agreement which can result in undue extension of the deal.
The proposed Vizhinjam Port is to be completed in three phases.
But by making the contract of Vizhinjam project fixed at 40 years, an extra amount of Rs. 283 crores had to be given to the Adani Group. Though the proposed port at Colachel, Tamil Nadu, is a similar project, its concession period is 30 years, said the report.
The CAG report on public sector undertakings for the year ended March 2016 was reportedly tabled in the Kerala legislative assembly on Tuesday.
"The interests of state government were not protected adequately while drawing up the Concession Agreement", it said in its conclusion.
Reacting to CAG findings, State Finance Minister T M Thomas Isaac said the report has confirmed the criticism raised by the LDF against the project, but "we are not going to scrap the project".
"The report stating the clauses of the Vizhinjam project, on which the state has pinned much hopes, are detrimental to its interests and very serious".
Defending the UDF decision on the project, Chandy said long term interest of the state had been protected in the deal.
THE absence of periodical inspections of buildings, shortage of manpower and equipment, and lack of adequate legal back-up have crippled the ability of the Fire and Rescue Services to effectively prevent and combat fire, the Comptroller and Auditor General of India (CAG) has found. "The Left Front had opposed the agreement with the Adani group for the project", he said.