NEW DELHI: The Ministry of External Affairs(MEA) is on a real estate purchasing spree across frontline global cities it seems. In a major real estate push, the MEA intends to spend nearly Rs 3000 crore to complete building constructions and acquire new properties over the next five years, with the focus on bringing down rents which have been a major drain on the exchequer.
The Government of India owns properties in 89 cities around the world and pays rent on leased assets for its chancery, residences and allied support staff in 97 cities.
Having faced innumerable audit objections over the years, the MEA’s Projects Division finally drew up a five-year plan from 2014-15 to 2018-19 to bring down this number substantially. The rental expenditure has seen a steadily rising graph in the last decade and is now hovering around Rs 280 crore annually.
Nearly two-thirds of the five-year projection is just for the construction projects located in 31 countries-- amounting to Rs 1922.49 crore. These are projects in which plots owned by the Centre requires construction for a functional mission. The biggest undertaking in this category will be the construction of the chancery and residences in New Zealand’s capital, Wellington for Rs 167 crore-- slated to be completed by April 2018.
The largest project for MEA in terms of cost is in Geneva, one of the most expensive cities in the world. Costing a whoppingRs 334.01 crore, this will likely be the ministry’s costliest project ever in recent decades and it will host New Delhi’s Permanent Mission to the UN .The Geneva proposal accounts for one-third of total demand of Rs 980.37 crore over five years, which will also see purchases in 21 cities including Tel Aviv, Tehran, Baghdad and Bratislava.
The cost of Geneva mission would overshadow the new chancery and residences in Kabul for Rs 260 crore. The Afghan project included a substantial increase in cost related to security-- around Rs 35 crore-- a necessary precaution due to the extremely high threat level. The Indian Embassy there has already been targeted twice in the last five years.
All the four Consulates in Afghanistan are functioning in rented properties. But, under the five-year-plan,the Foreign Secretary has approved a long-term lease of a building in Herat, Afghanistan’s third largest city located near the Iranian border. The construction of the Salma hydroelectric dam, one of India’s flagship assistance projects to the war-ravaged nation, is supervised from the Herat Consulate.
After a delay of over six years, a property team will be visiting the Southern Chinese port city of Guangzhou to acquire suitable land for building a Consulate and residences--a key diplomatic mission in the manufacturing heartland of India’s largest trade partner.
This was after India pays Rs 2.6 crore every year for a rental property, even though China was ready to hand over a plot of land for free on a reciprocal basis for its Consulate in Kolkata. However, this exchange got stuck after Mamata Banerjee Government reneged on an earlier commitment, which resulted in Beijing withdrawing its offer.