Trouble in Paradise: Paseo Caribe Project

Case Issues
The case suffers from corruption and governance issues both in the public and the private domain. While on one hand we see government failure to ensure and exercise regulations on the private party on the other hand we see private players going to any extent to maximize their profits with a blatant disregard to public property and natural resources. a) Public assets aimed to increase the prospects of the country as a viable tourist destination changing hands. b) Private players violating the norms of the agreement and changing the architectural plans without prior permission , acting in ways that shall maximize their returns on investment c) Employees, Residents, Culture Enthusiasts are the other stakeholders whose interests havent been properly catered to or effectively protected.

Facts of the Case

Paseo Caribe One of the bigger economic projects of the Puerto Rican government. Aimed at the strategically shifting the positioning of the place to tourist friendly state. The complex would comprise of a convention center, cruiseship ports ,complex with a room inventory of 930 rooms, shopping and entertainment center, exclusive boutiques, parking space deck of about 1500 vehicles The project was expected to generate 2000 jobs on construction and 2200 upon opening.

Figure 1: How Ownership changed hands

Madero on gaining access to the eland presented a land use consultation to the planning board and got it approved in 2000 (From the text it seems that the issue in context required amendment to Regulation 23 which didnt happen)

Ashish Mittal (2011078), Gaurav Dani (2011078), Piyush Sharoff (2011097), Pronit Kakati (2011101), Aravind NG (2011105), Sanmeet Singh Walia (2011107)

Plan was meant to be implemented with careful consideration to the nearby Spanish Fort which was a historical monument and protected by culture institute of Puerto Rico(ICP).

Opposition/Controversies Local public institutions complained about the blocking of access to the fort and adjoining beach which were classified as public areas under Puerto-Rican law. Residential institutions such as San Luis Condominium opposed the change in the zoning (residential to tourist) and proximity of the project to the building (Increased density of visitors/ Beachs view being blocked) Paseo Caribe project doubled the commercial area originally stipulated, moved the project away from the street in order to create space for the shopping center, altered the building heights, raised the occupancy limits and altered the rights of the way. The board approved construction of 70 additional housing units without amending either regulation 23 or prior permission. The requests from the regulating authorities which are in-charge of public resources such as water , the municipality , transportation and public works , ICP to hold back the approval until a proper inspection has been completed was ignored. NGOs ( Movimiento ambiental Revolcionario) started with a series of agitations to gain the attention from the media on this issue and so did other environmental organizations as well Government intervened and halted the process of construction for 60 days to revise the permits which had earlier been granted. The company complained that issues such as these prevents and resists private investment in financing and construction centers. This was later overruled by the court of law.

Obvious frauds, corruption issues as well as failures of governance

Paseo Caribe project doubled the commercial area originally stipulated, moved the project away from the street in order to create space for the shopping center, altered the building heights, raised the occupancy limits and altered the rights of the way. The board approved construction of 70 additional housing units without amending either regulation 23 or prior permission. The requests from the regulating authorities which are in-charge of public resources such as water , the municipality , transportation and public works ,

Ashish Mittal (2011078), Gaurav Dani (2011078), Piyush Sharoff (2011097), Pronit Kakati (2011101), Aravind NG (2011105), Sanmeet Singh Walia (2011107)

ICP to hold back the approval until a proper inspection has been completed was ignored. Irregularities as reported in the planning boards approval process.

Ashish Mittal (2011078), Gaurav Dani (2011078), Piyush Sharoff (2011097), Pronit Kakati (2011101), Aravind NG (2011105), Sanmeet Singh Walia (2011107)

Conflicts do you see in land usage issues in society. Can you discuss this in the Indian context with example?
Land is a treasured national asset and its exorbitant returns lead people resolving to illicit ways to procure and exploit one. We see several cases in the Indian context as well. In each of the following scenarios the contexts of procurement and exploitation may be different but the exploitation for maximum is the same Adarsh Society: In Adarsh case, the authorities were at first not only refusing to take action or own responsibilities but even evading the question through the probes' which have little credibility in the eyes of public. There was a complete loss of conscience and people could no more look at someone who can rescue the nation from neck-dip corruption, scam and loot of public money. Land meant for widows of Kargil heroes and a six story building was dubiously transformed into a full-fledged commercialized venture with aid from the polity Lavasa Project: With construction on 2,000 hectares, complete with four hotels, a town center, apartments and luxury villas and an adventure sports club, among other amenities, the very nature of the project indicates to cater to the fanciful demands of a specific privileged stratum of society that it seeks to gain monetary patronage from. The cruel and atrocious felling of trees and massive deforestation in the bid of carving out an industrial niche for the so-called modernized development of India unfortunately neglected the mutilation of the landscape and natures abode at the expense of profit-making ethic.

As sustainable development and ethical issue can you frame guide lines with a form of processes and template so that conflict resolution appears to be fair to all.
Before discussing any such framework we would like to make an explicit mention of the importance of infrastructure projects and their henceforth contribution to countrys GDP. This cant be undermined and can prove to be single biggest source of direct or indirect employment and foreign direct investment.

Ashish Mittal (2011078), Gaurav Dani (2011078), Piyush Sharoff (2011097), Pronit Kakati (2011101), Aravind NG (2011105), Sanmeet Singh Walia (2011107)

Regulatory mechanism shouldnt be concentrated only until the initial phases of any infrastructure project and adequate regulation should be distributed across stages in a project. Government should hand out occupation of land on lease or licensing basis so that government is in loop on any capital gains made on the sale of the natural asset. Other option is projects should be leased out on contractual or public private partnership basis so that the interest of each stakeholder is protected and cant be encroached upon by any other stakeholder. Government can also choose to make the private players deposit bank guarantees which could be confiscated in case there is a violation of contract. The funds so generated can be used to compensate other stakeholders or recuperate any damages done in case of violation of the contract or physical damages to the society or environment or adjoining property. By above measures we intend to present and ensure mechanisms to protect stakeholders and compensate them in case of encroachment. Besides natural resources, preservation of monuments is necessary and all architectural plans should be signed off by concerned authorities (ICP etc) before final launch.

Ashish Mittal (2011078), Gaurav Dani (2011078), Piyush Sharoff (2011097), Pronit Kakati (2011101), Aravind NG (2011105), Sanmeet Singh Walia (2011107)