Cyber City, also known as Kalamassery Special Economic Zone (SEZ), which promised to create one crore sq. ft. of built-up space and generate more than 65,000 direct jobs, seems to have met with a premature end even before it had taken off.

While the adverse market scenario for the IT industry is being cited for the inordinate delay, it is reliably learned that the sticky financial condition of the promoters is the reason why the project is remaining on the backburner.

The promoters, Housing Development and Infrastructure Limited (HDIL), will have to shell out about Rs.500 crore to Rs.600 crore initially to get the project under way. Funding alone could be the problem as the project otherwise had received almost all statutory approvals, including the approval from the Single Window Clearance Board, town planning department, Pollution Control Board, and environment clearance from the Union Ministry of Environment and Forests.

Though the promoters insist on going ahead with the project, a definite time schedule is missing and the investment has also shot up beyond the original estimate of Rs. 3,000 crore by at least 15-20 per cent.

With hardly two months left for the expiry of the original SEZ notification period of three years and almost two years after the construction work was launched by the then Industries Minister Elamaram Kareem in February 2011, the promoters have nothing but a fencing to show for the project. It is now learned that the promoters have approached the Union Commerce Ministry for an extension of SEZ notification for one more year. The project promoted by HDIL through its subsidiary Blue Star Realtors was notified as an IT/IT-Enabled Services-SEZ in March 23, 2010.

An informed official said that the promoters are not in danger of losing the land even if the IT project doesn’t materialise, as they had bought the 70 acres outright for Rs.100-odd crore during the early part of the last decade. They only need to ensure that it is used for an industrial project as the area falls within the industrial area, he said.

The promoters had planned to complete the project in three phases spread over nine years with two IT buildings of 10 lakh sq.ft. marked for the first two years.

The foundation stone of the project was laid in January 2008 only to be stalled following legal wrangling over the land transfer.