The massive Rs 20,000 crore information technology parks scam unearthed by MiD DAY is yet another indicator that when it comes to real estate, the unscrupulous partnership between builders, bureaucrats and politicians becomes unbreakable. Right under the very noses of the same bureaucrats that are supposed to regulate the IT parks and ensure that the tenancy of these buildings is given to IT and IT-enabled services firms, this newspaper found instances of blatant violations.
Governments have tried to encourage entrepreneurship in the IT sector as well as to attract world-class firms to come to India and run their companies. And yet, with flawed policies and lax regulation, the builder lobby has ruled the roost by taking advantage of a range of benefits they get by building an IT park. They get 100 per cent extra FSI, reduction of property tax to the level of residential premises, exemption on octroi, subsidised electricity, etc.
Indeed, which builder would not relish the thought of getting everything so cheap and then selling or renting out office space at existing commercial rates? The dilemma for policymakers could be this: should they let go of all regulation and allow market forces to take over for IT parks to survive and prosper, or should the sector be tightly regulated? But the answer is in the question itself -- if allowed to run amok without government regulation, the business of setting IT parks will lose all meaning, thus bringing us back to square one.
Now that such large-scale violations have taken place, it would be interesting to know what the government's reaction would be. Will it investigate and cancel licences provided to builders of these sham IT parks? Or will the government remain a mute spectator, implying complicity? The state government indeed has a lot to answer for.