Watch | An Indian ghost town is hoping to come alive
After the bifurcation of Andhra Pradesh in 2014, Hyderabad became the joint capital of Andhra Pradesh and Telangana for ten years, during which time Andhra Pradesh had to build a new capital. That's when Chandrababu Naidu, the chief minister of the newly carved-out state, conceived the idea of transforming Amaravati (285 kilometres from Hyderabad) from a farmland into a 'world-class' capital city with an initial budget of nearly ₹30,000 crore.
Nara Chandrababu Naidu, chief of the Telugu Desam Party, has taken oath as the Chief Minister of Andhra Pradesh for the fourth time, the second after the state's bifurcation.
With Naidu now in charge, a decade-old dream is set to come back to life: the Amaravati project.
After the bifurcation of Andhra Pradesh in 2014, Hyderabad became the joint capital of Andhra Pradesh and Telangana for ten years, during which time Andhra Pradesh had to build a new capital.
That's when Chandrababu Naidu, the chief minister of the newly carved-out state, conceived the idea of transforming Amaravati (285 kilometres from Hyderabad) from a farmland into a 'world-class' capital city with an initial budget of nearly ₹30,000 crore.
ALSO READ: Hyderabad no longer common capital for Telangana and Andhra Pradesh: Here's all you need to know
The government signed a Memorandum of Understanding with Singapore to prepare a masterplan for the city, which was later scrapped. It roped in British architect Norman Foster to design this ambitious city: 217 square kilometres between Vijayawada and Guntur, along the banks of the Krishna river.
According to Naidu, at this location, Amaravati would benefit from its proximity to two of the state's crucial cities while leveraging resources from the Krishna river.
ALSO READ: Chandrababu Naidu's return has also boosted fortunes of this ₹3,000 crore company
As per the initial masterplan, Amaravati would have four expressways, one inner ring road and 27 townships. It'd also have metro and riverway transport, riverside promenades, green spaces, along with educational, health, civic, sports and commercial facilities.
For this, Naidu's government took the route of land pooling instead of land acquisition.
He put together 33,000 acres of land from over 25,000 farmers through a land pooling Act that gave each farmer a commercial and residential plot in proportion to the land they contributed.
In addition to this, those with very fertile lands were to get ₹ 50,000 per annum and those with semi-fertile lands would get ₹30,000 per annum as crop compensation with a 5-10% increment every year.
Banking on Naidu's success in transforming Hyderabad, Amaravati saw immense investor interest.
Construction companies, retail majors, IT companies, and several others showed interest in developing infrastructure and setting up shops in Amaravati and across the state.
The World Bank and the Asian Infrastructure Investment Bank pledged $300 million and $200 million each to fund the development of the capital.
PM Narendra Modi laid the foundation stone in 2015, and work began in full swing and during Naidu's term, about ₹10,000 crore was spent.
As of 2019, the then-Andhra government filed the following as completed tasks in a status report:
Jagan, not convinced of Amaravati as the capital, halted the plan and eventually began working towards a three-capital structure: a Legislative capital in Amaravati, Executive capital in Visakhapatnam and a Judicial capital in Kurnool.
However, nothing materialised during his term and the state is currently without a capital city. Several companies that had come forward to invest pulled out. World Bank and AIIB also pulled back their funding.
What was supposed to be a thriving metropolis built from scratch to rival some of the best-planned cities in the world turned into a ghost town.
All Amaravati has to show today is half-constructed buildings, abandoned and empty structures, roads, and stretches of empty land.
But the biggest hit was on farmers who not only gave their land, but also their livelihood.
Some farmers CNBC-TV18 spoke to said that when work initially began in 2015, farmers found other forms of livelihood in the area, like setting up small hotels and tea stalls or working as part of the construction, helping them make a decent living.
"The farmers here suffered a lot for five years. We didn't have any source of income. It was very difficult. We didn't have the land to take loans against. If Amaravati is back on track, we hope that our troubles will end. If there's real estate development, and people come from outside, it will create business and job opportunities for us, and we can find ways to live," said Shaik Shahab, farmer & minority JAC convener.
Now, with Naidu returning to power, his biggest poll promise is back on the table.
Farmers say clearing work began even before he took oath, giving them hope of development in the area. Anecdotal accounts suggest land prices have already surged by 50-100%.
"Even before Naidu was sworn in, land prices shot up from ₹8,000-10,000 for one yard to ₹20,000-30,000," said Shaik Subhani, farmer.
People in the state hope that this will improve infrastructure, create jobs, and raise the standard of living not only for the people of Amaravati but also for the entire state.
TDP has already started work towards rebuilding Amaravati. Speaking to CNBC-TV18, K Pattabhi Ram, TDP's National Spokesperson, said a lot of activity has already started. We will definitely bring all the projects derailed in Amaravati back on track. We have always wanted it to be a growth engine," he added.
But how Naidu executes this greenfield project is key, given that the state's fiscal deficit was 4.2% for FY24 and that it is reeling under a debt of ₹13 lakh crore. TDP says it has concrete plans in place.
"We didn't spend a rupee to acquire land. Farmers themselves gave us land. When we came with municipal bonds, they were oversubscribed and we raised ₹2,000 crore through it. That's the model we've taken up. There is also some responsibility that lies with the Central government too. They had already given us ₹1,500 crore and with there will be more financial support from the centre," Pattabhi Ram said.
According to him, the government will also approach financial institutions for funding. "We are aware of the current situation of the state. We will work out a financial model without burdening state the exchequer," he added.
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With Naidu now in charge, a decade-old dream is set to come back to life: the Amaravati project.
After the bifurcation of Andhra Pradesh in 2014, Hyderabad became the joint capital of Andhra Pradesh and Telangana for ten years, during which time Andhra Pradesh had to build a new capital.
Vizianagaram: JanaSena party President and actor Pawan Kalyan with Telugu Desam Party (TDP) President N Chandrababu Naidu during a Prajagalam Sabha roadshow at Nellimarla, ahead of the second phase of Lok Sabha elections, in Vizianagaram district. (PTI Photo)
That's when Chandrababu Naidu, the chief minister of the newly carved-out state, conceived the idea of transforming Amaravati (285 kilometres from Hyderabad) from a farmland into a 'world-class' capital city with an initial budget of nearly ₹30,000 crore.
ALSO READ: Hyderabad no longer common capital for Telangana and Andhra Pradesh: Here's all you need to know
The government signed a Memorandum of Understanding with Singapore to prepare a masterplan for the city, which was later scrapped. It roped in British architect Norman Foster to design this ambitious city: 217 square kilometres between Vijayawada and Guntur, along the banks of the Krishna river.
According to Naidu, at this location, Amaravati would benefit from its proximity to two of the state's crucial cities while leveraging resources from the Krishna river.
ALSO READ: Chandrababu Naidu's return has also boosted fortunes of this ₹3,000 crore company
As per the initial masterplan, Amaravati would have four expressways, one inner ring road and 27 townships. It'd also have metro and riverway transport, riverside promenades, green spaces, along with educational, health, civic, sports and commercial facilities.
For this, Naidu's government took the route of land pooling instead of land acquisition.
He put together 33,000 acres of land from over 25,000 farmers through a land pooling Act that gave each farmer a commercial and residential plot in proportion to the land they contributed.
In addition to this, those with very fertile lands were to get ₹ 50,000 per annum and those with semi-fertile lands would get ₹30,000 per annum as crop compensation with a 5-10% increment every year.
Banking on Naidu's success in transforming Hyderabad, Amaravati saw immense investor interest.
Construction companies, retail majors, IT companies, and several others showed interest in developing infrastructure and setting up shops in Amaravati and across the state.
The World Bank and the Asian Infrastructure Investment Bank pledged $300 million and $200 million each to fund the development of the capital.
PM Narendra Modi laid the foundation stone in 2015, and work began in full swing and during Naidu's term, about ₹10,000 crore was spent.
As of 2019, the then-Andhra government filed the following as completed tasks in a status report:
- Finalisation of designs and initiating construction of secretariat,
- Interim High court and judicial complex inaugurated in February 2019,
- Private Public Partnership signed in 2018 for commercial and tourism infrastructure,
- Development of residential infra started in 2018.
But all this came to a screeching halt after Naidu's TDP lost the state election to its rival YSR Congress Party and Jagan Mohan Reddy took over as the CM of Andhra Pradesh in May 2019.
Jagan, not convinced of Amaravati as the capital, halted the plan and eventually began working towards a three-capital structure: a Legislative capital in Amaravati, Executive capital in Visakhapatnam and a Judicial capital in Kurnool.
However, nothing materialised during his term and the state is currently without a capital city. Several companies that had come forward to invest pulled out. World Bank and AIIB also pulled back their funding.
What was supposed to be a thriving metropolis built from scratch to rival some of the best-planned cities in the world turned into a ghost town.
All Amaravati has to show today is half-constructed buildings, abandoned and empty structures, roads, and stretches of empty land.
But the biggest hit was on farmers who not only gave their land, but also their livelihood.
Some farmers CNBC-TV18 spoke to said that when work initially began in 2015, farmers found other forms of livelihood in the area, like setting up small hotels and tea stalls or working as part of the construction, helping them make a decent living.
"The farmers here suffered a lot for five years. We didn't have any source of income. It was very difficult. We didn't have the land to take loans against. If Amaravati is back on track, we hope that our troubles will end. If there's real estate development, and people come from outside, it will create business and job opportunities for us, and we can find ways to live," said Shaik Shahab, farmer & minority JAC convener.
Now, with Naidu returning to power, his biggest poll promise is back on the table.
Farmers say clearing work began even before he took oath, giving them hope of development in the area. Anecdotal accounts suggest land prices have already surged by 50-100%.
"Even before Naidu was sworn in, land prices shot up from ₹8,000-10,000 for one yard to ₹20,000-30,000," said Shaik Subhani, farmer.
People in the state hope that this will improve infrastructure, create jobs, and raise the standard of living not only for the people of Amaravati but also for the entire state.
TDP has already started work towards rebuilding Amaravati. Speaking to CNBC-TV18, K Pattabhi Ram, TDP's National Spokesperson, said a lot of activity has already started. We will definitely bring all the projects derailed in Amaravati back on track. We have always wanted it to be a growth engine," he added.
But how Naidu executes this greenfield project is key, given that the state's fiscal deficit was 4.2% for FY24 and that it is reeling under a debt of ₹13 lakh crore. TDP says it has concrete plans in place.
"We didn't spend a rupee to acquire land. Farmers themselves gave us land. When we came with municipal bonds, they were oversubscribed and we raised ₹2,000 crore through it. That's the model we've taken up. There is also some responsibility that lies with the Central government too. They had already given us ₹1,500 crore and with there will be more financial support from the centre," Pattabhi Ram said.
According to him, the government will also approach financial institutions for funding. "We are aware of the current situation of the state. We will work out a financial model without burdening state the exchequer," he added.
ALSO READ:
Prestige Hospitality IPO: Real estate major seeks ₹20,000 crore valuation
The world’s conscience keeper for nearly a century has gone quiet for some time
View | A tale of two EM elections
(Edited by : Shweta Mungre)
First Published: Jun 12, 2024 6:00 PM IST
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