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RAK’s legal counsel concerned about Andhra Pradesh seaport project

RAK has expressed serious concerns over the delays in the implementation of the Rs 16,800-crore ($3.02b) seaport project in AP.

, ET Bureau|
Updated: Jul 04, 2012, 07.43 AM IST
HYDERABAD: The general legal counsel of the emirate of Ras al Khaimah (RAK) has expressed serious concerns over the delays in the implementation of the Rs 16,800-crore ($3.02b) seaport project in Andhra Pradesh and urged the government to resolve the issues immediately.

The move assumes significance in the backdrop of the speculation that the AP government is considering cancelling the approvals granted to the seaport project and also because the concerns are now being expressed by the RAK’s general legal counsel.

The seaport project, Vadarevu and Nizampatnam Port & Industrial Corridor (Vanpic), is jointly being executed by RAK and businessman Nimmagadda Prasad, who was arrested by the CBI on May 15 in connection with a corruption investigation .

The emirate had, in March 2008, partnered Nimmagadda Prasad’s Matrix Enport to set up two seaports, an airport and a port-based industrial corridor, promising to create direct employment to 64,000 people and economy-wide employment opportunities to over 4 lakh people.

The RAK general legal counsel, in a letter to the Andhra Pradesh chief minister N Kiran Kumar Reddy last Monday, has also pointed out that their recent attempts to seek appointments to meet him weren’t successful due to the Legislative Assembly sessions and byelections in the state.

This is the third time in the last year that RAK government representatives have aired concerns over their investments, Rs 845 crore so far, in the Andhra seaport project. The RAK emirate’s ruler wrote to the Indian prime minister in August last year and the RAK CEO appealed to the Andhra Pradesh chief minister in April this year to save the project that has got mired in various snags.

“We are very concerned about the delays to the Vanpic project, about the security of our investment to date, and about our ability to generate a return on our investment, going forward,” said the RAK general legal counsel Karm Al Sadeq, while seeking response from the Andhra Pradesh government on the concerns being raised by the RAK government.

A person in the know told ET: “The latest appeal from the RAK general legal counsel is an indication on the ground preparations by the RAK government to take it up legally at the highest levels to protect their investment interests.”

The RAK legal counsel said the concessionaire has completed all pre-development activities including the field survey and investigations, technical, marketing and environmental studies, and obtained all the statutory clearances including environmental approval from the ministry of environment and forests. The engineering, procurement and construction (EPC) contract was also awarded for the construction of the port.

“However, we understand that the concessionaire has not yet been able to commence construction at the port because certain conditions precedent for which AP government was responsible have not been satisfied,” said Sadeq.

When contacted, a senior AP government official in the industries ministry said: “The state government is yet to take a call on cancelling the agreements entered into for the Vanpic project. We are currently seeking legal advice from the central government since the matter involved agreements entered into with the RAK emirate on a government-to-government mode”.

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