In The Name Of Big Ticket Development, PIDB Opened Doors For Real Estate

Chandigarh: Overruling finance dept, the infrastructure development body dropped 33-year cap on land leased to private projects
The ruling SAD touted and contested the January 30 Assembly polls on the plank of infrastructure development but in the name of ‘big ticket’ projects, it set a precedent by allowing the Punjab Infrastructure Development Board to become an entry door for private real estate projects.
“The Punjab Infrastructure Development Board will provide for partnership of private sector and public sector and participation of private sector in development, operation and maintenance of infrastructure facilities,” reads the preface to the Punjab Infrastructure (Development and Regulation) Act, 2002.
However, in the name of public-private partnership (PPP), the PIDB in 2008 set a precedent by offering land on lease to luxury hotels and convention centres. In doing so, it also did away with the 33-year cap on land leased for PPP projects despite a written objection by the then special secretary of finance department, Jaspreet Talwar, days before the November 28, 2008, notification that raised the lease period to “as defined in the concession agreement”.
For the five star hotels, the lease period went up to 60 years and for bus terminal with rooftop helipad in Mohali’s prime land – another real estate project with 90 per cent commercial use – to 90 years.
Notably, the 7.5-acre prime land for bus terminal at Mohali was awarded for a bid of Rs 52 crore for a concession period of 90 years a few months after nine acres were auctioned by the Greater Mohali Area Development Authority for Rs 450 crore. Even the revenue sharing model in the bus terminal project was heavily loaded in favour of the Gurgoan private developer, C&C Constructions, as 90 per cent of the space is to be utilised for commercial use.
Of the much-hyped Punjab’s makeover through Rs 30,000 crore mega infrastructure projects -expressways, flying schools, IT Tower, inter-state check points, metro rail, bus terminals and ring roads – the board has just 13 to show on ground, three of which are five star hotels, one each in Amritsar, Mohali and Bathinda besides a three star hotel at Amritsar. The hotels are the first real estate initiative in the board’s history of PPP projects.
In the list of 13 that took off is also the Punjab Institute of Medical Sciences (PIMS) in Jalandhar. It courted controversy right from invitation of bids due to change in qualifying criteria – one of the potential bidders, Fortis Heathcare, moved court – and awarded of bid to a nondescript consortium, NRI Academy.
While the upfront amount paid by defaulters of bus terminal and flying schools was forfeited, both the PIMS governing body and that of PIDB gave a window of six months to the concessionaire of PIMS after it defaulted in timely payment of half of the consideration amount.
The other “mega” heath project is allotment of prime land adjacent to civil hospitals to Max Healthcare in Mohali and Bathinda. Here too, the model is loaded in favour of the private player for a “poor” consideration – treatment of poor patients. In technical education, two polytechnics were approved by the board and are coming up at Rahon and Nanowal.
Barring these, all the three expressways – Mohali-Phagwara, Mohali-Baddi and Pathankot-Ajmer – were shelved. The IT tower project in Mohali and two ring roads around Ludhiana and Amritsar too have not taken off. The Ludhiana Metro project is still in the detailed project report (DPR) stage and other than commercially viable Mohali, the bus terminal projects at Patiala and Bathinda too remained non-starters. The two flying schools were also grounded. Though the list puts 39 computerised inter-state check points envisaged at the cost of Rs 400 crore as implemented projects, they are still on paper and may not see the light of day as the Goods and Services Tax (GST) Act will render them redundant.

Source- http://www.financialexpress.com/news/in-name-of-big-ticket-development-pidb-opened-doors-for-real-estate/913144/0

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