Thiruvananthapuram: Yet another Kerala Government entity is in the throes of a severe financial crisis. The Kerala Optical Fibre Network (K-FON), the dream project of the State to provide high-speed internet connectivity, is facing a funds crunch. Its promoter Kerala State IT Infrastructure Limited (KSITIL) is yet to settle the bills presented by Bell Consortium that took up the contract for the executing the digital project.
Although the government had allocated Rs 100 crore in the Budget for K-FON, not even a single bill presented by the Bell Consortium has been paid for the past three months. The latter has begun withdrawing its officials after bills were not honoured on time.
The government also held back Rs 24 crore out of the Rs 85 crore sanctioned by the Central Government for the K-FON project after including it in the PM Gati Shakti scheme which aims to subsume infrastructure schemes of various ministries.
Hard times
The K-FON project is struggling to make progress even three months after its inauguration owing to the financial crisis being faced by the government. Although an order was passed sanctioning Rs 10 crore for the project, even that amount has not been disbursed.
The total outlay for the K-FON project is Rs 1,168 crore, not taking into account the annual maintenance outgo. The State Government has to contribute 30% of the outlay, with the rest coming as a loan from the Kerala Infrastructure Investment Fund Board (KIIFB). The K-FON promoter is required to repay this money.
The bills submitted by the Bell Consortium are forwarded to the KIIFB and the State Government by K-FON. The KIIFB releases funds only after receiving the State Government’s share for each of the bills.
The Bell Consortium has already invested around Rs 950 crore on the project. Of the bills worth Rs 750 crore submitted till now, only Rs 550 crore has been sanctioned. Only bills for small amounts have been passed this financial year.
The Centre allotted Rs 85 crore under the PM Gati Shakti scheme, which is aimed at expediting the development of basic facilities after Kerala demanded Rs 300 crore. A part of this fund that was released exclusively for the K-FON project was held back by the State without spending.
The project is also facing a hitch with K-FON not being able to complete the work for which money has already been paid. The government had sanctioned funds last year for providing free internet connection to 14,000 Below Poverty Line (BPL) households. But, only 4,000 connections have been given even after one year.
K-FON has washed its hands of its responsibility by putting the onus on the contracting company.
