Kerala CM Clarifies TECOM Exit From SmartCity Kochi: Payment Is Share Settlement, Not Compensation

Kerala Chief Minister Pinarayi Vijayan addressed concerns regarding the state government's decision to repay Dubai-based TECOM for its exit from the SmartCity project in Kochi. He clarified that the payment is not compensation but the settlement for TECOM's 84% stake in the venture, as evaluated independently.

“Contrary to misconceptions, the payment reflects the value of TECOM's shares, not compensation for losses,” said Vijayan. As per the project's framework agreement, the government is obligated to repay the lease premium of ₹91.52 crore and infrastructure costs if the lease is canceled. Clause 7.2.2 mandates an independent evaluator to determine share value, a process currently underway.

The Chief Minister reassured that SmartCity Kochi would remain under full government control, dispelling rumors of a hidden real estate agenda. “Allegations of abandoning SmartCity are unfounded. We are committed to advancing Kerala's IT sector,” he asserted.

Opposition leader VD Satheesan accused the government of lacking transparency and favoring private entities in the transaction. Responding to these criticisms, Vijayan highlighted the establishment of a Chief Secretary-led committee comprising Finance, Revenue, Law, and IT department officials. The committee aims to oversee TECOM's withdrawal and implement Advocate General recommendations to ensure a smooth transition.

Vijayan further emphasized Kerala's historic ties with the UAE and the critical role of the additional 246 acres of land in boosting the state’s IT infrastructure. The government plans to use this land to attract more companies and address space shortages in Infopark, Kochi, which is 99% occupied.

The SmartCity project, launched in 2005, faced delays and controversies over land lease terms. Revived in 2011 by the Left Democratic Front (LDF), it fell short of delivering the promised 90,000 jobs. The current government aims to reposition the project for Kerala's IT-driven future while ensuring transparency and public interest.