Transworks prime property becomes money spinner for the government
The Sri Lanka government is earning money with ease from the idle 4-acre Fort Transworks land as the Krrish group, the lessee of the property continues paying an interest plus some part payments for delaying the final payment of Rs. 640 million of the total lease payment of Rs.4.9 billion, Minister of Investment Promotion Lakshman Yapa Abeywardene told a media conference in Colombo Tuesday.
Krrish has paid a sum of around Rs.66 million (US$ 0.5million) during the past two months and the company has already paid 87 per cent of the total lease amount, he said, but he did not elaborate as to how much of it is to be deducted as the interest payment.
The minister who set a September deadline for the final payment at a media conference in July evaded a question raised by a journalist on extending the deadline at Tuesday’s media briefing saying that the government is not concerned about it as it is earning money from the deal.
Responding to a question raised by a journalist, he said that he was not aware about a meeting between the chairmen of the Urban Development Authority (UDA) and the Krrish Group in Colombo on 12 August as reported in some web sites..
He said that Krrish Group chairman Amit Katyal did not meet him during his so-called Sri Lanka visit to inform the UDA that work on this project could begin in October this year.
Krrish group will have to pay an accumulated sum of Rs. 800 million with 12 per cent interest to the UDA to honour the lease agreement to be eligible for tax concessions under the Strategic Development Projects Act, a senior BOI official said.
The BOI has granted six extensions to Krrish group to settle the balance payment since May last year.
Minister Abeywardene noted that the BOI is considering the inclusion of a deadline in future investment agreements to prevent the re-occurrence of delaying project implementations.
Meanwhile the UDA has given an assurance to the Committee on Public Enterprises (COPE) that it would include a deadline on all future agreements, when it was queried on the feasibility of canvassing for investments outside the authorised mechanisms such as the Board of Investment.
The UDA will introduce this deadline for payment for new projects, after the Krrish Group delayed payments for the Transworks Square Project. This matter was transpired before COPE.
UDA also informed COPE that more than 1,250 investors had been attracted to the project through the authority’s website.