Tata Housing today expressed "deep disappointment" over the new Sri Lankan government reportedly reviewing its housing project in Colombo, saying the "arbitrary" move will hurt investor confidence.
Tata group's realty firm also dismissed as factually incorrect allegations that it was making miniscule investment and selling houses at higher rates, saying the company was committed to investing over USD 400 million over the next 8-10 years.
"Tata Housing expressed deep disappointment on the alleged press reports that have appeared over the past two weeks quoting some government authorities regarding the new government's decision to review the project based on allegations that are not factual in nature," the company said in a statement.
Tata Housing said that such actions by the government discredits the authorities in Sri Lanka that have been engaging with the company over the past three and half years and have granted multiple approvals for the project.
"Besides, such arbitrary actions will also adversely impact confidence of overseas companies to make future investments in Sri Lanka," it added.
In May 2014, Tata Housing had announced its foray into Sri Lanka with an investment of over USD 400 million (about Rs 2,400 crore) to develop a township project at Colombo in tie-up with Urban Development Authority (UDA) of Sri Lanka.
The project is spread over 8 acres of land, out of which 3 acres are earmarked for rehabilitation.
Recently, Sri Lanka's Finance Minister Ravi Karunanayake was quoted as saying that Tata group's housing project was being reviewed. Late last month, the country's new government had said it was looking for a fresh start into the first-of-its-kind township plan.
Tata Housing said the project has been identified as a 'Strategic Development Project' under the agreement with Board of Investments wherein it has made a commitment to invest USD 429.5 million over a period of eight to ten years with a foreign direct investment of USD 130 million over this period.
"Tata Housing has already infused significant capital in the project to commence the construction work for the redevelopment of buildings," the spokesperson said.
Tata Housing said the company is "committed to its flagship project in Sri Lanka" that promises to be a model project to uplift the high density underserved areas of the city, provide the inhabitants with better healthy life and transform the urban areas.
"In line with the Tata group ethos, Tata Housing abides by a strict code of conduct and always acts in accordance with the laws and procedures laid out by the country it operates in. As a responsible company, we are keen to cooperate with the new government and the UDA for ensuring the long-term success of this project," the statement said.
Tata Housing had said last year that the Sri Lankan Urban Development Authority rehabilitated residents of the Slave Island till the time of the completion of the project. The authority aimed to provide housing facility to the occupants with over 550 residences.
In the luxury project, the project would have estimated 4 residential towers comprising about 650 units. The project will also have retail area, office space and business hotels and service apartments.