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    Published On : Wed, May 4th, 2016

    Gorewada Zoo Goof Up : Rs 415 cr projected for just Rs 32 cr land; No clarity bars investors!

    Nagpur: The ambitious Gorewada Zoo project of Chief Minister Devendra Fadnavis appears far from reality, thanks to the escalating budget and non-feasible plans laid out for the project. As a section of media turned on Gorewada issue in the aftermath of investors’ reluctance of taking up the project as joint venture partner (JVP) under public private partnership (PPP) basis, the situation has opened a can of worms blocking the project’s progress completely.

    Reliable sources informed that the consultant has been given the amount but there has been no detailed plan and real estimates yet presented. “There is a nexus between consultant Ashfaq Ahmad a CCF Yadav and Ex MD of Forest Development Corporation of Maharashtra Mr Sood who are not letting this to happen”, added the source.

    Experts said the main issue is of feasibility. Private parties who will invest over Rs 400 crore in the project will first see the return on investment. “Nagpur doesn’t have that crowd that will spend so much nor is there big infrastructure to cater to foreign tourists. The political atmosphere is not conducive either. Projects like Mihan have been languishing for years together. So who will invest?” a source asked.

    Nagpur Today learnt that in all pre bid meetings Ex MD Mr Sood sits and talks on behalf of FDCM. “Who will put in 415 Cr with only actual payoff in 15 years without any gaurantee of ROI,” questions an expert.

    However few experienced people including city’s renowned architect Virendra Khare tried to make the Gorewada zoo plan on the lines of Singapore zoo but FDCM is totally non supportive, added a source.

    A Costly Affair…

     

    Even as Gorewada Zoo project is yet to pick up, real estate players are trying all out to cash on the name. A hoarding opposite Yeshwant Stadium in Dhantoli offers plots in the name of Gorewada Zoo

    Even as Gorewada Zoo project is yet to pick up, real estate players are trying all out to cash on the name. A hoarding opposite Yeshwant Stadium in Dhantoli offers plots in the name of Gorewada Zoo

    Sources said that FSI of land offered is only 0.4. The value of land is only Rs 32.5 cr and the project outlay of over Rs 400 cr is pretty exorbitant. Due to this, financial institutions & venture capitalists are reportedly unhappy with the working presented by FDCM. “How can they fund the project for 400 cr against land of just 32.5 cr? Nothing has been mentioned in the consultant’s plan. This clearly means that  consultants are either hiding or not sharing the cost estimates,” said an expert.

    No flexibility

    In case of BOT the bidder needs autonomy & freedom to modify the project based on feasibility. The estimates & feasibility report needs to be wetted by some renowned agency like PWC, E&Y etc, if the project aims at matching the levels of Gorewada zoo.

    In prebid meeting neither the consultant company nor the authority representatives could reply to queries raised by bidders.  There is no clarity on marketing funds for zoo which would be huge and who will bear the same.  Also the Cash flow statement given is for after completion of project & not during construction.

    Environmental clearances awaited

    More importantly, Gorewada is a reserve forest and FDCM has no clearances under Forest Clearance Act (FCA) 1980 and Environment Protection Act 1986. The Centre on February 5, 2015 has already clarified that the project attracts provisions of FCA. The proposal under FCA has to be uploaded on the website of environment ministry and acknowledgement has to be sent to the GOI. Unfortunately, FDCM is yet to start the process of preparing proposal under FCA. The MoEFCC made it compulsory for all the user agencies to upload all proposals for diversion of forest land for non-forestry purpose in form A & B on website from October 29, 2013.

    The MoEFCC clarified that no proposal for diversion of forest land will be accepted unless it is uploaded on website after December 1, 2013. On the contrary, state government submitted the proposal for diversion of forest land for Gorewada zoo on September 30, 2015, without uploading it in the format as required by the MoEFCC. Hence, GOI returned the proposal on February 1, 2016 asking the government to upload it on MoEFCC website and submit the acknowledgement.

    Nagpur Today recently received few pointers on the progress of Gorewada Zoo from an expert which questions series of anomalies in the project

    –  The basis of footfall needs to be verified.

    – The financial feasibility report is not elaborate.

    – Return on investment sheet for the investor and based on that IRR calculation with clarity and justification of each entity should be there.

    – Encroachment clearance before handing over any non forest land offered in lieu of investment and that land should be well suited for commercial project so that the investor can create return path for returns on his investment.

    – Also environmental norms for non forest land means what permitted and what’s not.

    –  The project report itself shows break even after sixteen years who will wait for so long is there any surety that anticipated profits for 15 years if not met would be taken care by the governing body.

    – They should invite the bidder to present a proposal, how can they make it feasible. With this report, the project will never see the daylight.

    –  The project was envisaged six years from now. i.e. 2008. Was mr Sood MD then? How can an ex MD be a part of AACPL team?

    –  We need to have a good discussion with right decision makers so that things can move in desired direction.

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