Emaar sees no impact from India penalty
Dubai, October 25, 2010
Dubai-based Emaar Properties said it would not be affected by a penalty by Indian authorities, after New Delhi said it would penalise the firm for delays and defects in the constructon of the Commonwealth Games village.
In a statement to the Dubai bourse on Monday, the company said the penalty has "no direct impact" on it.
"The encashment of the guarantee has no direct impact on Emaar as the guarantee has been issued through the facilities available to the company in India," said the statement.
The $230 million athletes village, built over 63.5 hectares, had come under criticism because of its shoddy construction and was delayed by several months.
The Delhi Development Authority (DDA) had contracted Emaar MGF, the Indian joint venture of the firm, to build the village.
A DDA spokeswoman said earlier that they had written to the federal urban development ministry that they were going to penalise Emaar MGF. DDA were yet to calculate the penalty.
The amount would be deducted from an about 2 billion rupees ($44.88 million) bank guarantee given by the developer, she said.
Emaar said the Games Village was built to the highest standards of quality and design.
"The Village was handed over to the DDA and the Organising Committee after a full inventory of facilities, items and assets in June 2010," said the Emaar statement.
"No dues are outstanding to any government agencies including the Delhi Jal Board and BSES and all requirements have been duly complied with by the company."
Emaar MGF will take all possible action required to protect the company's interests, said the statement. - Reuters