Explained: Will work stop at Amaravati after World Bank withdraws funding?

The new YSR Congress Party can still go ahead with the construction because the Centre allocates funds for various projects under the Amravati Capital City project.

Explained: No, work will not stop at Amaravati

The World Bank was considering extending a loan of $300 million to the Andhra government to build the capital city on the banks of river Krishna.

The World Bank has pulled out of funding infrastructure development of Amaravati capital city in Andhra Pradesh, but that will not stop construction. It was considering extending a loan of $300 million to the Andhra government to build the capital city on the banks of river Krishna. However, after an inspection, the agency found that many of the assurances given by the previous Telugu Desam Party (TDP) to safeguard interests of those who lost livelihood were not fulfilled and, thus, withdrew from the project.

The new YSR Congress Party can still go ahead with the construction because the Centre allocates funds for various projects under the Amravati Capital City project. In the last five years, the Centre has allocated Rs 1,500 crore for Amaravati. The AP government can also reapply for loans after fulfilling the preconditions set by lending agencies like minimising environment impact, addressing concerns of loss of livelihoods and grabbing of fertile land and protecting the floodplains.

READ | World Bank drops $300 million in funding for Amaravati Capital City project

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The YSRCP government has for the time being halted taking up new constructions in the capital city. Except for those which are already under progress like apartments and bungalows for government staff and All India Service officers, contracts awarded after April 1, 2019, for new projects have been cancelled by Chief Minister Y S Jagan Mohan Reddy who has ordered an inquiry into the contracts citing irregularities and corruption. Municipal Administration and Urban Development Minister Botsa Satyanarayana said construction will restart only after the probe is completed. “There are several irregularities and corruption in the contracts awarded by the TDP regime. We may have to cancel some tenders and call for new ones in a transparent manner. Apart from seeking funds from Centre we will apply elsewhere for loans,’’ he said.

The Andhra government can also reapply for loan from WB after addressing the concerns raised in the inspection report. The state overnment had also sought $200 million from Asian Infrastructure Investment Bank which has not taken any decision yet. AP Capital Region Development Authority Commissioner Dr P Lakshminarasimhan said they will study the reasons why the WB has dropped out of the project and then take a call whether to pursue it or approach a different agency.

Former chief minister N Chandrababu Naidu had dreamed of constructing a world-class capital in Amaravati on the south bank of river Krishna, over 217 sq kms. The TDP regime had procured 34,000 acres of fertile land from farmers under a land-pooling scheme. An interim secretariat, Legislative complex, interim high court building, and over 280 km of six-lane roads have already been constructed in the capital city. The previous government had estimated that Rs 48,000 crore would be required to complete the construction of the capital over 10 years. In the first phase of construction, against an outlay of Rs 19,769 crore, Rs 14,630 crore of works have been awarded. Under construction are 12-storeyed apartments for government employees, trunk infrastructure, and 186 bungalows for judges, ministers, chief secretary, principal secretaries. On the private investment side, top educational institutions like Vellore Institute of Technology, SRM University, NID, Amity, Amrita University, Centurion University, Central Institute of Tool Design, and NIFT have started construction, or have already started functioning from their new premises.

Construction of the AIIMS campus, Indo-UK Institute of Health, a 2,250-bed multi-super speciality hospital of Mata Amritanandamayi Trust which is an extension of the Amrita Medical University at Knowledge City, are fast coming up.