Jagan Govt Closes Amaravati 'Start-Up Area' Project, Ends Pact With Singapore

The capital city project has hit several roadblocks.

New Delhi: In what comes as another setback to what were the Chandrababu Naidu government’s ambitious plans for Andhra Pradesh’s upcoming capital, the Amaravati Capital City Start-Up Area Project has been closed by the Jagan Mohan Reddy government.

The project was being developed by the Singapore Consortium and had hoped to facilitate an economic hub at Amaravati. The Singapore government, through its Ministry of Trade and Industry, said on November 12 that it has accepted the decision.

“The closure is based on mutual consent between the Government of AP and the Singapore Consortium (comprising Ascendas Singbridge Pte Ltd (now part of CapitaLand Group) and Sembcorp Development Ltd),” News Minute quoted a press release of the ministry as having said.

Also read: Amaravati, an Example of Flawed Urban Policy

The Jagan government has been keen to stymie the previous government’s enthusiasm for the Amaravati project. On November 11, it issued a government order announcing the closure of the start-up area, reported News Minute. The order said that the project had not seen ‘intended development’ in spite of two key agreements having been signed between the government and the Consortium.

Both News Minute and The Hindu BusinessLine quoted portions from the Singapore government’s press statement which contained quotes from the minister-in-charge of Trade Relations, S. Iswaran indicating that Singapore remained open to investing in India and Andhra Pradesh and that the loss of “a few millions” was a calculated risk the government was prepared to take.

This is the latest in a string of problems with developing Amaravati. In his August article for The Wire, Mayank Aggarwal wrote:

The murmurs of trouble in the project had started soon after the new government came to power as there was no surety of political and financial support to the project. However, the biggest jolt came in July 2019 when the World Bank announced its pullout from the project.

Not only has the capital city project been hit by financial crunches, Jagan had made it clear immediately after acquiring office that he considered the land acquisition process at Amaravati – that occurred while Naidu had been chief minister – a big scam.