The Times of India reported that on 20 Aug, the new Andhra Pradesh municipal minister Botsa Satyanarayana hinted that the state may drop Amaravati and choose other cities instead to be the new state capital.
He mentioned that his new state government would soon come out with an announcement on the future of Amaravati which would answer all concerns.
“If construction in other areas costs Rs 1 lakh, it costs Rs 2 lakh in Amaravati. This is a huge waste of public money. Moreover, if there are heavy rains, low-lying areas would be prone to flooding. We need to construct separate drains or small dams to protect people from floods in Amaravati. Discussions are on. We would take all these factors into consideration and announce our policy soon,” Satyanarayana said.
Recently, the World Bank had also dropped its US$300 million funding for the construction of Amaravati and Asian Infrastructure and Investment Bank (AIIB) had also exited the project.
Doubts over Amaravati’s future, which is touted as the largest Greenfield capital city in the making, began after the YSR Congress Party (YSRCP) won this year’s state election to lead the state of Andhra Pradesh. The new Andhra Pradesh Chief Minister YS Jagan Mohan Reddy was reported to be not too supportive of the Amaravati project as it was the brainchild of the previous Chief Minister Naidu.
Opposition party members want Chief Minister Reddy to clear the air, reported The Hindu on Friday (30 Aug). Said Janasena Party president Pawan Kalyan, “Municipal Administration Minister B Satyanarayana’s statements have created a lot of confusion and it is imperative for Chief Minister Jagan Mohan Reddy to clear the air. Farmers in the area gave their lands to the AP government for construction of the capital and not to the TDP or Chandrababu Naidu. The YSR Congress government should act reasonably and responsibly.”
Kalyan also wondered if it would be possible, or even desirable, to shift the capital at this juncture after spending lots of monies on it. “Who will bear the loss? It would be a huge burden on the people of the State. If there are corruption charges against the previous Government, they can be probed and action taken against the leaders in power then. But ordinary people and farmers in the area cannot be punished for it,” he added.
Singapore already dumped S$4 billion into Andhra Pradesh
The Amaravati project is in fact, 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 under the Telugu Desam Party (TDP).
After the TDP lost to YSRCP in the recent general election in May, developments in Amaravati came to a halt. 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.
The new government has accused the previous Chief Minister involving 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.
Singapore High Commissioner to India meets new Chief Minister
On 9 Aug, Singapore High Commissioner to India Lim Thuan Kuan went to meet the new Chief Minister Reddy. He 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 other areas, 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.
But the Chief Minister told Lim and MTI officials 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.
Meanwhile, it has been reported that undertainties over Amaravati has led to land prices in the supposedly “new capital” region dropping sharply in the last two months. It’s not known if Ascendas-Singbridge or Sembcorp holds any land there.