Decks cleared for UAE firm's Rs 700-crore project in Hyd

State to hold 26% equity in convention centre-cum-township project

The Andhra Pradesh state government today cleared the integrated convention centre-cum-golf course-cum-township project proposed by the UAE-based $7.7-billion Emaar Properties in Hyderabad, but with some modifications.

The state government will hold 26 per cent equity in all the projects, and because of the modifications to the project, the total cost has gone up to Rs 700 crore from the initially estimated Rs 400 crore.

Though the project was originally cleared by the previous TDP regime, the new government led by Y S Rajasekhara Reddy wanted the promoters to amend the original proposal made a couple of months back.

After several rounds of informal consultations, the Group of Ministers led by finance minister K Rosaiah today cleared the project by bringing down the proposed equity of government in the convention centre from 49 per cent to 26 per cent, on par with its proposed equity in the other two projects, namely the golf course and the integrated township.

Among all the facilities proposed to be built by the Emaar Properties in the 535-acre land, the convention centre was supposedly a loss-making proposition. So, the plan to hold a uniform 26 per cent equity across all the three projects is to the advantage of the government, official sources said.

Yet, the government decision is a clear departure from its original stand where it asked the promoters to drop the idea of township development and limit themselves only to building the convention centre in the Hitech City.

The important inclusion that has been approved by the Group of Ministers is the construction of a 'Business Park' with a built-up office space of approximately one million sq ft to house the operations of IT companies. With the inclusion of this facility, the total investment into the project is expected to go up to around Rs 700 crore.

The seating capacity of the proposed convention centre has now been increased to 5,000 from the original 3,000 seats, sources said. The convention centre has to be built and handed over to the government before May, 2006 as the project was conceived to host the annual general body meeting of the Asian Development Bank(ADB), which is scheduled to be held around the same time.

Confirming the development from Dubai, a representative of Emaar Properties told Business Standard, "The decks have been cleared for the project now. Work will start very soon as the process of finalisation of contracts for the same are already in an advanced stage."

Emaar Properties, a real estate major, is a publicly held company listed on the Dubai Financial Market with an asset base of US$ 7.7 billion (including land). It also owns and manages four subsidiaries "� Dubai Bank, Amlak Finance, Emrill Services, and Sahm Technologies.