Is Amaravati a Utopian Dream??

The relatively new born state of Andhra Pradesh had the foundation laid for its new capital city of Amaravati on 22^nd of this month. The proposed capital region is spread about an area of 7,420 sq. km and the capital city of 217 sq.km. It is the brain child of its Chief Minister N. Chandra Babu Naidu, as he faces one of his biggest challenge to construct the city. The master plan for the city was developed by urban planning consultants Surbana International Consultants Pte. Ltd based out of Singapore. They proposed an ambitious Seed Capital Area (SCA) Master Plan for the capital city. Some of the key highlights of the plan are as under-

1)   The SCA will house close to 3 lakh residents. Being a vibrant business hub, close to 7 lakh jobs are expected to be created

2)   The plan also proposes to construct an integrated network of Metro railway (12 km), Bus Rapid Transit (15 km), downtown roads (7 km), arterial and sub-arterial roads (about 26 km) and collector roads (about 53 km).

3)   The plan is to construct a city with world class aesthetic appeal but adhering to the sustainable green principles with extensive open green spaces

4)   Special emphasis has been laid on the ‘pedestrianisation’- with development of 25 kms of walkways linked to open green spaces to promote a ‘walk to work environment’

5)   A dedicated freight corridor and establishment of 7 industrial zones have also been proposed. A total of 938 kms of roads have been proposed

While every resident of the state including me will be excited to see a ‘‘Singapore’’ level at Amravati and so does its Chief Minister, he and his team have their task cut out. In this blog I want to discuss about the challenge the state faces in raising capital.

Funding- Any project in this capacity requires a large amount of capital especially since a new city is to be constructed. One option for the CM and his team is to go in for a PPP model. But again PPP projects on such a large scale have not been constructed in India. Moreover the roadblocks faced by the present HMRL project (PPP) in the neighboring state has not gone down too well for the private sector. Also given that the project is slated for completion in the year 2050, its too long a call for any private company.

The Centre has promised a sum of Rs. 60,000 crores as per the recommendations of the 14^th Finance Commission. In addition to paying the farmers for the compensation of their land, a huge deficit still exists. So how does the CM look to raise money for his ‘dream’ Project in addition to the state allocated budget and institutional borrowing? Some of the options he could avail are-

·         He can look into the option of Corporation investment from big companies along the industrial corridor in and around Amaravati (Vijayawada and Guntur). Companies can be encouraged to develop infrastructure in select pockets near their establishments by providing incentives such as free land, water and electricity.

·         Already a lot of investment is coming from Telugu Association of North America (TANA), the largest association of Telugu people living outside India. They are raising funds through campaigns like ‘My Brick-My Amaravati’ wherein donations are being accepted for buying bricks (at Rs 10 a brick)

·         The Chief Minister has already embarked on a journey to bring in investment from IT companies, like he did when he was the Chief Minister of the then Andhra Pradesh. 

So a lot depends on the Chief Minster himself and he needs to sail through the next election to come to power for another term in order to see his dream city take shape

References

a)   http://www.livemint.com/Politics/pJXIgjMM8849rTBxJDjiyL/Is-Amaravati-Chandrababu-Naidus-biggest-challenge-yet.html

b)   http://indianexpress.com/article/explained/andhra-pradeshs-new-capital-amaravati-in-chandrababu-naidus-capital-idea-desire-to-impress-connect/

c)  http://indiatoday.intoday.in/story/chandrababu-naidu-amaravati-capital-challenge/1/455244.html