Hyderabad, Aug 27: Describing as a total sell out the capital formation contract given to Singapore companies with clauses loaded in favour of the
foreign firms, YSR Congress has said that it is detrimental to state interests as Andhra Pradesh government will remain a junior partner will have little or no rights in the whole venture.
Speaking to reporters here on Saturday party MLA and PAC Chairman Buggana Rajendernath Reddy said: ‘ The agreement between the State Government and the Singapore consortium is overwhelmingly in favour of the foreign company and such an agreement will not stand the scrutiny of the Indian Contract Act.
The contract gives the Singapore company sweeping powers with its 58 % share and four directors on board of six which enables the foreigners to dictate terms and act as per their whims and fancies.’ Not just that the irrevocable power of attorney and the way obligation, responsibility, liability and accountability have been placed on the Indian side keeping the foreigners away is a total sell out on part of Chandrababu Naidu and his obsession for Singapore has reached its peak, he said.
With four directors and 58 % stake, it is the Singapore company that calls the shots and more teeth is given by adding clauses of compensation and termination norms which gives them a hefty package even if Singapore company pulls out on its own. ‘Such ridiculous clauses will be not be valid under the Indian Contract, which is a fact they have ignored’, he said adding the company does not even qualify for Swiss Challenge as their participation in the capital building was solicited much earlier.
The irrevocable power of attorney authorizes the Singapore company, with four of the total six directors, to act at will in developing the 1,690 acres of land under the Amaravati Development Authority. It has a share in every deal right from broker commission and shares no responsibility at all. The term of contract is pegged at 15 years which can be extended by another five years. Twenty years and 1,690 acres of land are placed on a platter to the Singapore companies increasing the liability of the people of the state, he said.
It is the responsibility of the government to develop the peripheries which is another clause that is loaded in favour of the Singapore company. ‘The state has to spend its own money for the benefit of Singapore company and should supply sand, bricks, power, gas, water, lay gas pipeline and roads and if the government gives land at a discount the deficit should be filled and paid to the Singapore company. The penalty and recovery in case of pulling out has been placed at 150 % which is highly abnormal and we strongly object to the norms which is a total sell out on part of the Andhra Pradesh government, he said.
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