Centre objects to USTDA clauses

The Centre has raised objections to some clauses in the draft agreement between the AP government and the US Trade and Development Agency (USTDA) over the Visakhapatnam smart city master planning & sector specific smart city infrastructure project plan.

The state government had referred the draft agreement to the Law and Finance departments and the former had observed that the municipal administration department could satisfy the conditions as set forth in the draft agreement in consultation with the Finance department.

In the meantime USTDA furnished a final grant agreement and requested expediency in signing the agreement. However, the draft and final agreements are the same.

The AP Municipal department had sent the agreement to the Centre for a ‘no objection’ certificate. The Ministry of External Affairs has sent back the file with specific suggestions.

It has suggested replacing clause 22 as offered by USTDA. The clause states: “This grant agreement shall be governed by, and construed in accordance with the applicable law of the United States of America. In the absence of federal law, the laws of the state of New York shall apply.”

The Centre has proposed the amendment to this clause as: “All activities in terms of this agreement shall be subject to the applicable domestic laws of the country where the activities are carried out. The Centre also suggested the Department of External Affairs take concurrence from the Ministry of Defence and Indian Navy on the agreement.