Telangana lost money in joint ventures
Land allotment to Raheja IT park cost state Rs 74 crore: CAG.
Hyderabad: The CAG report on public sector undertakings has exposed deficiencies in the management of public sector units (PSUs), which resulted in huge financial implications to the state exchequer. Out of total 67 PSUs in TS, only 45 are working, while the rest 22 are non-operational.
The land allotment to Raheja IT Park has resulted in Rs 73.75-crore loss to the state exchequer as it was allotted at a rate lower than the rate fixed by APIIC. FAB City project has also resulted in a huge loss to the exchequer.
TSIIC — including its earlier avatar of APIIC — had invested Rs 572.53 crore between 1994 and 2015 in two joint ventures and 12 special purpose vehicles (SPVs). Of these, the CAG audit covered two JVs and eight SPVs. Four SPVs were not audited.
The company had invested Rs 79.27 crore in two JVs ('59 crore) and eight SPVs (Rs 20.26 crore) either in the form of cash or land and is expected to receive return in the form of dividends, lease premium and lease rentals.
The rate of return on investment in one JV, namely K.Raheja IT Park, Hyderabad, was as low as 0.43 per cent per annum. Apart from equity, the company had also contributed 109.3 acres of land (Rs 54.68 crore) to the JV.
“On the ground of proper implementation of the project, the JV firm was demerged and land was transferred (97.21 acres) to the demerged companies. The balance land (12.15 acres) was transferred to Non-IT/ITeS sister companies of Raheja Group, at a rate lesser than the rate fixed by Price Fixation Committee and without consulting APIIC. This had resulted in a loss of Rs 73.75 crore,” the report said.
The CAG said there was no return on the investments made by APIIC in eight SPVs. To promote the semi-conductor industry and to develop FAB City, the FAB City SPV was founded in May 2006.
The investments made by APIIC in FAB City was not productive and resulted in a blocking of Rs 78.56 crore. There was undue favour to SemIndia FAB City (Rs 22.61 crore) due to non-collection of lease premium, lease rentals and duties.