KIIFB's Rs 2.49-crore-per-acre land deal: Vigilance probe may follow; 2,074 acres in Kannur acquired without required approvals

THIRUVANANTHAPURAM: A Vigilance investigation may be launched into the Kerala Infrastructure Investment Fund Board's (KIIFB) acquisition of 2,074 acres of hilly land in Kannur at Rs 2.49 crore per acre without the required approvals. The government is also expected to recommend a comprehensive audit by the Comptroller and Auditor General of India (CAG). The land was acquired during the previous government's tenure.

The KIIFB board granted administrative approval based on a letter from former KIIFB CEO K.M. Abraham, even though no specific project had been identified for the land. The Cabinet had not approved the purchase, and the Finance Department had not given its approval either. Without these approvals, KIIFB could not have legally granted administrative approval for the acquisition.

The land was acquired through the Kerala Industrial Infrastructure Development Corporation (KINFRA). Based on Abraham's letter, the Industries Department granted administrative approval for land acquisition worth Rs 12,727 crore in Kannur and Palakkad districts. A loan was raised from the Housing and Urban Development Corporation (HUDCO) at an interest rate of 9% to finance the acquisition.

In Kannur, 1,044 acres were acquired at Kolari in Iritty and another 1,030 acres at Koodali. Apart from 12.93 acres earmarked for the Higher Education Department and 50 acres allocated to KINFRA's IT park, the remaining land lies unused and overgrown with vegetation.

Although the Budget had announced plans to acquire 500 acres in Vizhinjam, the proposal was subsequently dropped. The report also points to the involvement of private individuals with political influence in the land acquisition process.

Budget had proposed land acquisition at Pattannur

The Budget had announced plans to acquire 1,000 acres at Pattannur in Kannur. Following the announcement, the KIIFB CEO wrote to the managing director of KINFRA. Subsequently, based on a note from KINFRA, efforts were made to acquire 4,896 acres in Kannur. KIIFB has transferred Rs 2,489 crore to KINFRA, and a tripartite agreement was subsequently signed between KIIFB, KINFRA and the state government. While the land already acquired remained unused, KIIFB issued another notification to acquire an additional 3,829 acres at a cost of Rs 9,572 crore. Including interest at 12%, the total cost of land acquisition is estimated to reach Rs 15,000 crore.

Centre's Industrial Park scheme sought amid land deal controversy

• In an apparent attempt to address concerns over the land acquisition, the state also applied for assistance under the Centre's Bharat Audyogik Vikas Yojna (BHAVYA) scheme for developing industrial parks. The second Pinarayi Vijayan government sought central assistance for developing industrial estates.
• Under the scheme, land can be acquired at a maximum rate of Rs 1 crore per acre. In Kannur, however, the reported acquisition price was Rs 2.49 crore per acre. There is no indication that central assistance has been received so far.
• The state has incurred losses running into crores of rupees in interest payments over the past six years. Even if the land is sold, the proceeds would not recover even one-fifth of the amount spent, according to the report.