World Bank `drops’ Amaravati. The inside track.

In 2016, the Andhra Pradesh government headed then by Chandrababu Naidu had applied for a loan from the World Bank to fund its ambitious state capital project in Amaravati. A year later, the project ran into trouble with farmers who opposed the manner in which land pooling exercise was carried out, complaining to the World Bank.

Environmentalists also opposed the manner in which fertile plains along the river Krishna were being taken over to build a concrete jungle. The application was put on hold then though the AP Capital Region Development Authority had maintained the bottlenecks were being cleared. 

Now the World Bank has dropped the plan to extend a loan of $300 million to fund the Amaravati Sustainable Capital City Development project. The status of the loan under Project ID 159808 has been changed from `pipeline’ to `Dropped’ on the World Bank website. 

According to sources, the decision was taken after the Centre disallowed the World Bank’s demand to conduct a probe into allegations of irregularities in the proposed project. Meanwhile, the Andhra Pradesh government headed by YS Jaganmohan Reddy is conducting its independent probe and has said in the state assembly that work in Amaravati will resume only after the completion of the inquiry. 

What are the implications of the World Bank decision and what does it mean for Amaravati? T S Sudhir of Filter Kaapi spoke to Vijayasai Reddy, Rajya Sabha MP of the YSRCP and the Special Representative of the Andhra Pradesh government in Delhi. 

Sudhir : Why did the World Bank decide to drop the loan for the Amaravati capital region project?

Reddy : The Government of India is a sovereign government. When it comes to the World Bank, it is a matter to settle between the international agency and the Government of India. Certain complaints were received by the World Bank regarding the project. These pertained to irregularities committed by the Chandrababu Naidu regime, including corrupt practises. World Bank wanted to send a team to Andhra Pradesh to investigate the matter. 

Also read : Amaravati’s stock plummets

The question is whether the Government of India will allow a foreign agency from a foreign country to conduct an inquiry on our land. Of course, the Government of India could have conducted its own probe by central agencies and given the report to the World Bank. 

As far as the Andhra Pradesh government is concerned, since law and order is a state subject, we have set up our own probe. The cabinet sub-committee will give its report in 45 days to the Cabinet which will then take a decision on it. 

Sudhir : These are the complaints that were made to the World Bank when Naidu was CM?

Reddy : Yes, during his regime. The World Bank wanted to conduct its own probe. 

Sudhir : So is the matter of the loan closed for the new Andhra Pradesh government headed by Jaganmohan Reddy?

Reddy : No, why do you say that. We can always make a fresh application. 

Sudhir : The impression that has gained ground is that the Amaravati project has been put on the backburner. Work in the capital region was stopped after Jaganmohan Reddy took charge as CM, inquiry ordered and the state budget saw slashing of funds for Amaravati.

Reddy : No, you are drawing your own conclusions. Resource mobilisation can always happen.

But the belief of the YSR Congress, not now but even before elections, has been that development should be decentralised. It should take place in all the 13 districts of Andhra Pradesh. Not a Hyderabad-like situation where only the capital city earlier was developed. 

Also read : Jagan calls Naidu’s Amaravati a scam

Sudhir : So you are saying you do not wish to put all the eggs in one basket. 

Reddy : Yes

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