Officials of NICE argue that at this rate “the government can tomorrow try to take over Infosys with a legislation saying excess land has been allotted to the company or the Bangalore International Airport from the private consortium”. The project has a real estate component, but this is not new, say the officials.

The Kumaraswamy government’s move to take over the project will depress investor sentiment in Karnataka at a time when the government itself is trying to instill confidence in Bangalore and Karnataka after a virtual crumbling of infrastructure in the region. Sources say the government has not gone in for a complete cancellation of the project on account of the international arbitration clause in the Framework Agreement. The proposed legislation is also seen as an attempt to work around the arbitration clause.

johnson.ta@expressindia.com