Amethi food park cancelled as promoter failed to comply with requisite conditions: Food Processing Minister

New Delhi: Days after Rahul Gandhi raised the issue of a mega food park in his constituency Amethi, the government on Tuesday said the project was cancelled after the promoter company failed to comply with requisite conditions for approval.

In a detailed statement, read out in the Lok Sabha amid din created by Congress members, Food Processing Minister Harsimrat Kaur said the food park's promoter company had expressed its inability to pursue the project in the absence of natural gas, whose allocation was denied by the previous government in December 2012.

The issue pertains to cancellation of proposed Shaktiman Mega Food Park Pvt Ltd in Amethi.

The House saw ruckus after Speaker Sumitra Mahajan allowed the Minister to make a statement on the matter, with Congress members protesting against the decision and even questioning the Chair's partiality.

Rahul Gandhi, Congress Vice President, had last week attacked the government over the issue and also accused Prime Minister Narendra Modi of practising politics of revenge.

Kaur said that in view of inordinate delay by the promoter company in meeting the "pre-conditions for final approval, in-principle approval accorded to the project by the Ministry was cancelled".

The decision of the cancellation was conveyed to the promoter company on July 11, 2014, she added.

The issue of inordinate delay was considered by an inter-ministerial approval committee on June 30, 2014 and then the in-principle nod was cancelled.

She said that during a review meeting of the project's progress in June last year, the promoter company's representative had informed that without supply of gas at administered price, it would not "consider the project to be viable".

"In the absence of availability of gas at the administered price the promoter company expressed its inability to pursue the project," the Minister said.

Kaur said the Ministry of Petroleum and Natural Gas in December 2012 had communicated that it would not be possible to allocate domestic gas for the food park due to acute shortage of domestic gas and lowest priority accorded to captive power plant for such allocation.

Supply of imported LNG through GAIL for meeting the requirement of captive power plant could be feasible and the same was communicated by the Ministry to the promoter company, she noted.

"However, the promoter company vide their letter dated January 16, 2013 informed the Ministry that using imported LNG for captive power generation would be totally uneconomical and would therefore make the project financially unviable.”

"The promoter company also conveyed that they cannot go ahead without domestic natural gas being allotted to them for captive power plant at the administered price," she said in the statement.

Besides, Kaur said the promoter company through a letter on June 26, 2014, had informed that it was yet to acquire required land as changes in Uttar Pradesh State Industrial Development Corporation guidelines for subleasing was still under consideration.

Then the promoter company had sought extension of time till September 30, 2014, she added.