Smart City: Narendra Modi's Rs 78,000 crore GIFT project caught in red tape at the Centre
A 50:50 joint venture between a state government undertaking and Infrastructure Leasing and Financial Services (ILFS) Limited, GIFT city was planned as a global financial and IT services hub
Oct 11, 2014
Source : The Economic Times
Narendra Modi, Prime Minister India

 

NEW DELHI: The Narendra Modi government has ambitious plans to build 100 smart cities, but the first smart city that the Gujarat government had embarked on under then chief minister Modi in 2007 — the Rs 78,000 crore GIFT city is caught in red tape at the Centre, threatening its viability due to incomplete buildings, lack of power utility lines and most importantly, the absence of corporate tenants who were expected to populate it.

The Gujarat government has approached the Centre, now firmly under its previous boss' grip, to push long-pending clearances from the ministries of finance, highways and civil aviation, for the Gujarat International Finance Tec (GIFT) City so that its first phase can meet its 2014 deadline.

A 50:50 joint venture between a state government undertaking and Infrastructure Leasing and Financial Services (ILFS) Limited, GIFT city was planned as a global financial and IT services hub spread over 886 acres near Ahmedabad airport and is expected to create a million direct and indirect jobs.

Though the project was allowed to set up a multi-services special economic zone with an international financial services centre in 2011, not a single financial institution is ready to set up shop at the city yet, said officials, as the government is yet to issue any regulatory norms on carrying out operations within the financial services centre.

"We wanted GIFT City to be comparable to other global financial hubs like Shanghai, Tokyo and London, but not a single financier is ready to book space in the city due to the lack of norms. We have repeatedly requested both the finance and commerce ministries to notify some regulations for such operations, without which existing capacity isn't being utilised while further development of the project is hindered," said a state government official aware of the development, requesting anonymity.

The state has now urged the urban development ministry to intervene for an early resolution of the hiccups faced by the GIFT city. The ministry, in turn, has escalated the case to the project monitoring group set up in the cabinet secretariat to expedite stalled investment projects and the project's issues are now under examination, officials said. One of the biggest roadblock faced by GIFT City, is the aviation ministry's reluctance to grant height clearances most of the tall buildings expected to tower the city's length and breadth. This has thwarted construction work on most of its flagship towers being built in the first phase.

"The Airports Authority of India has only granted permission to build towers upto 191 metres above the mean sea level. At this height, 47 of the 110 buildings, including its biggest towers, cannot progress," the official quoted earlier said. The tallest of the 110 buildings that are part of the masterplan, named Diamond Tower, is expected to rise up to 410 metres, while two other towers would be over 350 metres tall.

GIFT City had requested the airport authority, which is also in charge of air space navigation services and related clearances in India, to grant it a height clearance for buildings upto 476 metres. Similarly, the National Highways Authority of India has been hesitant about granting permission to lay power cables to light up the City's infrastructure.

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