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Home / India News / Amaravati takes a back seat in Andhra Pradesh budget

Amaravati takes a back seat in Andhra Pradesh budget

Capital city Amaravati, the dream project of the previous Telugu Desam Party government headed by N Chandrababu Naidu, was pushed to the back burner by the YS Jaganmohan Reddy government.

india Updated: Jul 12, 2019 23:24 IST
The newly-formed YSR Congress party government in Andhra Pradesh on Friday presented its first budget in the state assembly for 2019-20.
The newly-formed YSR Congress party government in Andhra Pradesh on Friday presented its first budget in the state assembly for 2019-20.(Pic:Style Photo service.)

The construction of Andhra Pradesh’s new capital Amaravati, a dream project of Telugu Desam Party (TDP) president and former chief minister N Chandrababu Naidu, seems to have been pushed to the back burner by his successor, YS Jagan Mohan Reddy.

The YSR Congress Party government, which presented its first budget in the assembly on Friday with a total outlay of ₹2.27 lakh crore, allocated a mere ₹500 crore for the capital city.

The amount is insignificant when compared to the magnitude of the project, which requires at least ₹51,000 crore for the completion of its first phase, according to estimates of the AP Capital Region Development Authority (APCRDA).

Since the Amaravati project was conceived in 2015, the previous TDP government has made considerable budgetary allocations – ₹3,168 crore in 2015-16; ₹1,500 crore in 2016-17; ₹1,061 crore in 2017-18; and another ₹1,000 crore in 2018-19 -- to it.

“The allocations in the budget for Amaravati might be on the decline, but the previous government resorted to large-scale borrowings to take up the work on the capital. By the time Naidu lost power in the elections, construction work of ₹39,875 crore was (already) under execution in the capital city,” an official of the APCRDA said requesting anonymity, hinting that much of the investments required for the first phase have already been made.

While the Centre gave ₹1,500 crore for the capital’s construction in 2015-16, the TDP government mobilised ₹16,810 crore from financial agencies such as HUDCO and loans from commercial banks, besides raising ₹2,000 crore through capital bonds listed on BSE last year. “The proposal for a World Bank loan for ₹3,324 crore is pending approval,” the official added.

Finance minister B Rajendranath Reddy presented the budget, projecting the total revenue deficit of ₹1,778.52 crore and fiscal deficit of ₹35,260.58 crore, which is 3.30% of the Gross State Domestic Product (GSDP).

The budget focussed mostly on implementation of “Navaratnas” (nine jewels) promised by Jagan Reddy during his marathon 3,600-km padayatra in the state in the run-up to the April-May general elections.

“Our government has come out with an action plan for bringing the Godavari waters to the Krishna basin to provide irrigation to the parched lands of Rayalaseema and stabilisation of agriculture in delta areas, supply of drinking water to every household, providing sanitation and solid waste management in every town and completion of all pending irrigation projects...,” the finance minister said.

Reddy reiterated the government’s commitment to achieve special category status for Andhra Pradesh by relentlessly pursuing the matter with the Centre.He said the state inherited a totally bankrupt exchequer, which was unprecedented in the history of the country. The outstanding debt of the state, which was ₹1,30,654 crore (including₹33,530 crore public borrowings) in June 2014 , rose to ₹2,58,928 crore in April 2019.

Among the allocations made to various sectors are: ₹13,139 crore for the irrigation sector, ₹8,750 crore for YSR Rythu Bharosa (payment of ₹12,500 each per year to farmers towards crop investment), ₹11,399 crore for the health sector etc.