AP body mulls options to raise Rs 58k cr for new capital

Amaravati: The agency developing the new Andhra Pradesh capital has come out with several options, including creation of a Government-to-Government (G2G) Equity Fund, to mobilise the Rs 58,000 crore required for completing the project in the next three years.

Of the total amount, Rs 32,000 crore is required for development of basic infrastructure like roads, drinking water, drains and lighting in the capital Amaravati, according to proposals drafted by the AP Capital Region Development Authority (CRDA).

CRDA Commissioner C Sreedhar made a presentation on this at a high-level meeting chaired by Chief Minister N Chandrababu Naidu here today.

A round-table meet will be conducted here on November 25 to explore the investment and fund-raising options.

Various countries that evinced interest in partnering with the State Government in the development of Amaravati would be roped in as partners in the proposed G2G Equity Fund, Sreedhar explained.

A sum of Rs 1,400 crore is expected to be raised through the Fund, which will be spent on mixed-use development and social infrastructure development in the capital.

Issuing Capital Development Bonds to raise Rs 2,000 crore is another option the CRDA has come out with.

“We have to appoint an investment advisor and also fulfil certain legal process for setting up the G2G Equity Fund. For issuing the Capital Development Bonds, clearances from the Finance Department and the State Cabinet are required,” the Commissioner said.

Already, the CRDA is in talks with the World Bank for a USD 500-million loan, while Hudco, a Central PSU, has given a “firm commitment” for a Rs 7,500-crore loan.

The state and Central government is also expected to extend required financial support for the capital development.

In fact, the Centre has already released Rs 1,500 crore for construction of key Government buildings like Secretariat, High Court and Legislature complex and the CRDA expects to get another Rs 1,000 crore soon.

A Public-Private Partnership model is also being looked at to raise Rs 5,500 crore for creation of power distribution network, water and road network. An empowered committee will be put in place to approve the PPP structure, an official release said.

Finance Minister Yanamala Ramakrishnudu, Municipal Minister P Narayana and senior officials attended the meeting.