Last month, it was reported that the joint venture project between Singapore and India to build the new Amaravati capital city for the state of Andhra Pradesh has been stalled by the newly elected Indian state government.
The project is a joint development between the Singapore Consortium led by Temasek-linked Ascendas-Singbridge and Sembcorp Development, and Amaravati Development Corporation Limited, a company set up by the previous Andhra Pradesh state government.
Andhra Pradesh was earlier governed by the Telugu Desam Party (TDP) which was aligned with PM Modi’s Bharatiya Janata Party (BJP). However, at the recent India’s general election in May, the ruling TDP lost the Andhra Pradesh Legislative Assembly election. The YSR Congress Party led by Y.S. Jagan Mohan Reddy swept the elections with a majority of 151 out of 175 Assembly seats, propelling Reddy to become the new Chief Minister of Andhra Pradesh, defeating Mr Naidu of TDP.
Unfortunately, the new Chief Minister Reddy is not a keen supporter of the Amaravati capital city joint venture project and has even publicly announced that the project is “not a priority” for him. The new state government is reviewing all ongoing works and cutting finances, triggering uncertainty over the future of the state capital project which Temasek-linked entities Ascendas-Singbridge and Sembcorp Development have invested in.
Work on the capital city, which has been running behind schedule, has come to a standstill. Chief Minister Reddy has set up a team of technical experts to review every aspect of the project, following allegations that the previous Chief Minister was involved in corruption over the way land was acquired, as well as other improprieties including insider trading. People linked to the previous Chief Minister were said to have allegedly bought land with the knowledge of where the capital city was going to be located before any formal announcements were made.
To underscore Reddy’s disdain for the project, it was reported that his new state government has even gone ahead to cancel flight arrangements connecting Amaravati’s Vijaywada Airport and Singapore’s Changi Airport, an agreement signed by the previous state government with Singapore. Not surprisingly, the TDP has labelled the present state government’s move to undermine the capital city project a political vendetta.
Singapore sends High Commissioner to talk to new Chief Minister Reddy
On Friday (9 Aug), it was reported in Indian media that Singapore High Commissioner to India Lim Thuan Kuan went to meet Chief Minister Reddy on the sidelines of the Diplomatic Outreach programme. Lim was accompanied by officials from Singapore’s Ministry of Trade and Industry.
Lim told Chief Minister Reddy that Singapore is ready to invest more in thermal, solar, aerospace and related fields, apparently in an attempt to appease the new Chief Minister.
Lim also informed the Chief Minister about the present collaboration Singapore already has with the state of Andhra Pradesh, in areas such as urban planning and development, waste and water management, power, building and construction, public healthcare, and public libraries, under a Memorandum of Understanding, which was endorsed by the Government of India.
Officials and experts from the State and Singapore have worked closely to develop priority economic sectors of aquaculture, construction and urban solutions, logistics and connectivity, tourism, and Smart City Projects, Lim noted.
The High Commissioner also reminded the Chief Minister that investments by Singapore companies in the state now exceed Rs20,000 crore (S$4 billion) creating a substantial number of jobs across the state. Singapore has also actively promoted Andhra Pradesh as a promising investment destination to Singapore and international companies at various international platforms, Lim recalled.
However, the Chief Minister explained to the Singapore delegation that the challenges and steps his administration was taking are to improve literacy in the State, and to collaborate with industries to improve the skill levels of workforce in Andhra Pradesh. The meeting ended with the usual pleasantry that both sides would agree to continue exploring further opportunities for mutual benefits.
“Rather striking was the omission of Amaravati in the statements of both the sides”, observed the Indian media, New Indian Express.
It looks like to appease the new Chief Minister Reddy further, Singapore might end up “investing” money into the state’s education too. Whatever it is, Chief Minister Reddy now could compel Singapore investing anything he fancies for his state by using the trump card Amaravati capital city project on his hand.