Amaravati: The Start-up Area Project within Amaravati city was closed, as it was not found feasible. The Singapore Consortium and the Andhra Pradesh government mutually agreed to call it off. State Finance Minister Buggana Rajendranath said that they found it impractical to take up such a massive project that involves a considerable investment, which does not match the proposed development.
A Start-up Area Project within Amaravati was proposed to develop an area of about 16.91 acres by a company called Amaravati Development Partners Limited. The latter consisted of a few Singapore companies, namely Ascendas Singbridge and SembCorp, and Amaravati Development Corporation belonging to the Andhra Pradesh Government.
The minister said that the proposal noted that Singapore Consortium would have equity of 58% of the project, while Amaravati Development Corporation will have 42%. “The decision to close the project was made after deliberations and discussions between both parties. During the deliberations, it was realised that this proposed area is a small part of the huge city, which was proposed to be developed. The big city, along with the area around it, comprising of the Capital Region Development Authority, is about 217 sq km, which is almost twice the size of Mumbai, including Navi Mumbai and suburbs.”
He added that within this CRDA is Amaravati, which is around one lakh acre in area. “This area was proposed to be acquired by way of combining private and government land. Various owners would pool their fertile land and accumulate a total of 35,000 acres, while 10,000 acres of government land will be added to it. Over 40,000 acres of forestland would be acquired via deforestation, for which the AP government had requested the Centre to clear it.” Amaravati city is a small part of the CRDA comprising of 1,700 acres within this vast area of one-lakh acres.
During deliberations, they realised that it requires about Rs 2 lakh crore, which is the size of the annual state budget, to develop one-lakh acre. “Unless that amount is spent and the whole area is developed, there is no meaning in having a business district in it,” said B Rajendranath, adding that the project would take decades to be completed and not within five years. “Neither time nor finance permits such development in such a short time. The AP government has now recognised various other requirements of the state such as infrastructure health, industries, employment to youth and the holistic development of the entire state and its 13 districts.”
The AP Finance Minister noted that in this scenario, they realised that the development of 1,700 acres alone is not easy as it was thought by the previous government, as it is almost a difficult task. He explains that this how it was decided to wind up the project and that it is in the best interest of the state.
“At the same time, the Singapore Company, which is represented by the Singapore Ministry of trade and industry, has released a press note saying that the closure of the consortium does not impact their investments in India,” he said.