Minister for Industries in Andhra Pradesh, Mekapati Goutham Reddy, on Thursday, responded to the Lulu group’s statement that it won’t be investing in new projects in the state.
The YSRCP leader said that there were two reasons for the cancelation of the MoU with the UAE-based conglomerate. While the lack of transparency in the bidding process was one reason, Mr. Reddy cited the violation of environmental norms as the second issue. “As per the agreement made in the previous regime, the price fetched for one sq.ft of land will not be more than Rs 5. With the land being leased out at the lower price, about Rs 500 crore of public money would have been lost annually. The Andhra Pradesh government, therefore, had to cancel the Lulu Group’s deal,” he said.
The Industries Minister also added that the land in Visakhapatnam was is in dispute and was directly allotted to the Lulu Group in single bidding. Mentioning that the previous TDP government had made deals just for show-off, Mr. Reddy said that the YSRCP-government is at not fault for canceling such agreements.
In a statement released recently, Lulu Group’s Director of India, Ananth Ram noted, “We had participated in a very transparent bidding process and were awarded the land on lease for this project. Though we have incurred huge expenses towards initial project development costs such as appointing internationally renowned consultants and designing the project by world-class architects, we agree to the decision of the new Government of Andhra Pradesh to revoke the land allotment for this project. Given the current scenario, we have decided not to invest in any new projects in the state of Andhra Pradesh.”
The Group had earlier planned to invest Rs 2200 crore for setting up an international convention centre, shopping mall, and a five-star hotel in Visakhapatnam.