SemIndia Chairman Vinod K. Agarwal has assured Chief Minister Y.S. Rajasekhar Reddy that the proposed Fab City would come up without any hurdles. Mr Agarwal, who has the backing of Union Minister for Telecommunications Dayanidhi Maran, met the Chief Minister, Minister for Major Industries J. Geetha Reddy and senior officials as part of a damage-control exercise.

The opposition had alleged the other day that the Fab City project was in trouble and that Mr Agarwal was duping the government. It is learnt that the Chief Minister told Mr Agarwal that Fab City was a prestigious project of the State government and asked him to begin it at the earliest. Mr Agarwal reportedly told the Chief Minister that the project was delayed because of the delay in the Centre’s announcement of its semiconductor policy. He assured that it was facing no other hurdle.

Sources said that the government would issue a GO on Wednesday or Thursday for setting up Fab City. “Once the GO is issued, work will begin,” said an official who took part in the meeting. “Mr Agarwal is ready with the project blueprint.” The State government had signed a memorandum of understanding with SemIndia Inc, a US-based corporation on September 12, 2005, to launch Fab City.

Mr Agarwal brushed aside opposition allegations and assured the Chief Minister that the MoU was signed with a legitimate firm. He plans to address the media on Wednesday to clear the air.