Dubai: A Dubai-based consortium has threatened to move court against the Maharashtra government in India for dillydallying over a multi-billion dollar project aimed at giving a facelift to one of the world’s largest slums.
Sprawled over 2.4 kilometres on prime land in India’s financial capital Mumbai, Dharavi is home to over 700,000 slum dwellers.
In March 2019, Seclink Technologies Corporation (STC), headquartered in Business Bay, Dubai, emerged as the top bidder for the ambitious Dharavi redevelopment project, estimated to cost nearly Dh14 billion.
But one year after clinching the deal, STC is still waiting for an official Letter of Award (LOA) needed to start work.
N. Shah, the firm’s chairman and managing director said he is at his wit’s end. In a phone interview with Gulf News on Wednesday, he said: “We have been writing to the state-run Dharavi Redevelopment Project Authority (DRPA) for more than seven months but they are yet to issue us the letter which officially awards us the contract.”
Shah, who has since written to Prime Minister Narendra Modi seeking intervention, said the delay has hurt them badly.
“Now we have no choice but to move court and seek Dh1.2 billion in compensation from the Maharashtra government to cover our losses,” he said.
Shah said the consortium’s investors in the UAE have suffered huge financial losses because of the hold up. “We have to set aside $4 billion (Dh13.5 billion) towards the bank guarantee for the project,” he said.
He also took a dig at India’s ranking on Ease of Doing Business (EDB) which has climbed 14 places, to be ranked 63 among 190 countries.
“The Ease of Doing Business is a cruel joke considering the Maharashtra government was supposed to issue the letter of award within seven days of us winning the bid. If they sit on a global social impact investment project for so long, one can well imagine the fate of other projects.
"Prime minister Narenda Modi goes around the world issuing global tenders and asking for Foreign Direct Investment (FDI). But once international companies like us participate in a bid and qualify they have to face hurdles at every step. We won the bid fair and square but now find ourselves caught in bureaucratic red tape,” he said.
The Dharavi makeover project was first conceptualised in 2003 and has since been on the agenda of many political parties in India.
It was also one of the poll promises made in 2014 by Bhartiya Janata Party leader Devendra Fadnavis when he came to power in Maharashtra now ruled by the Maha Vikas Aghadi (MVA) a three party alliance between the Shiv Sena, NCP and the Congress.
The project was revived in 2017 and a Special Purpose Vehicle (SPV) was set up to include private to include private-public partnership in 80:20 ratio before global tenders were floated in November 2018.
Seclink emerged as the highest bidder after it quoted investments worth Dh3.73 billion.
The other bidder was the Adani Group, which quoted Dh2.35 billion. Shah said he suspects a conspiracy is being hatched to award the contract to another bidder.
Earlier this year, he wrote to the committee that awards the contact expressing fear of a corporate coup.
What is Dharavi?
Sprawled over 2.4 kilometres on prime land in Mumbai, India, Dharavi is one of the largest slums in the world with a population of about 700,000 people.