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Southern Lights | The 15k crore grant for Andhra’s Amaravati should hinge on functionality, not grandiosity

Jul 24, 2024 08:38 PM IST

The new capital city should cater to the following basic needs— potable drinking water, sanitation, waste management, and access to urban transport

Finance minister Nirmala Sitharaman announced the allocation of 15,000 crore to rebuild Amaravati, Andhra Pradesh’s capital city, in her budget speech on Tuesday. The announcement was more than a shot in the arm for chief minister N Chandrababu Naidu whose fourth term has so far been characterised by a cash-strapped exchequer.

Amaravati, Jun 20 (ANI): Andhra Pradesh Chief Minister N Chandrababu Naidu during his visit to Andhra Pradesh Capital Region, in Amaravati on Thursday. (ANI Photo)(N Chandrababu Naidu-X) PREMIUM
Amaravati, Jun 20 (ANI): Andhra Pradesh Chief Minister N Chandrababu Naidu during his visit to Andhra Pradesh Capital Region, in Amaravati on Thursday. (ANI Photo)(N Chandrababu Naidu-X)

Naidu's words on social media, thanking the FM summarised the dire need for the confidence-injecting capital grant. "This support from the Centre will go a long way towards rebuilding Andhra Pradesh. I congratulate you on the presentation of this progressive and confidence-boosting budget.”

Andhra Pradesh government data released at the end of the previous fiscal revealed some worrying numbers about the state's financial condition. Public debt rose from 31.02% of the Gross State Domestic Product (GSDP) in 2019-20 to 33.32% in 2023-24, indicating a steep decline in the past five years. Former bureaucrats and economists believe the Union government’s generous dole to the state for the capital city will enable Naidu to deliver on the promises made in the manifesto.

Although Sitharaman declared that the fund allocation would be fulfilled through multilateral agencies, it remains to be seen if the massive allotment comes as a grant or interest-free loan to the state. While the Union government’s announcement didn’t surprise many, the quantum of capital and immediacy comes after Naidu met with the entire top brass of the Bharatiya Janata Party (BJP) in the last few weeks, seeking patronage for Andhra.

The announcement of the grant for the historic city Amaravati, which was once the capital of the 2nd-century BCE Satavahana dynasty, also puts to rest former CM Jagan Mohan Reddy’s proposal to name Visakhapatnam, Kurnool, and Amaravati as three capitals for the state.

Andhra and Bihar topped all other states to receive the maximum grants, possibly in lieu of the special status that Nitish Kumar and Chandrababu Naidu — both allies of the National Democratic Alliance (NDA) — have been pressuring the government for.

However, just two days before the budget, Pankaj Chaudhary, minister of state for finance, said in his written reply to a member of Nitish’s Janata Dal (United) that no such status would be granted.

As part of her budget, Sitharaman also allotted over 3 lakh crore for women-specific schemes, and Andhra is expected to be a huge beneficiary of this scheme given that Naidu had pioneered the self-help group movement in the former Andhra Pradesh state. The Union government will also fund the massive Polavaram irrigation project.

Andhra Pradesh’s real-time governance minister Nara Lokesh also thanked the Centre. Lokesh said in a post on X in Telugu: “Thanks to the central government which has announced that it will provide full support for the completion of the projects of Amaravati, the capital of Andhra Pradesh, and Polavaram, Jeevanadi.”

Use funds judiciously: Experts

IYR Krishna Rao, the state’s first chief secretary after the state was bifurcated in 2014 said: “A capital city has multiple infrastructure requirements and the previous grant of 2,000 plus crore was insufficient. While the fund inflow was expected, Naidu’s fiscal problems with continue. He not only requires capital grants but also revenue grants. The state has already overleveraged itself in terms of borrowings but is also struggling to meet budgeted expenditure.”

The former bureaucrat expressed the state’s ability to create sufficient in the next 2-3 years stating that capital creation was a long gestation project.

Similar sentiments were echoed by Karuna Gopal, urban planner and president of the Foundation for Futuristic Cities. As one of the lead designers of the 100 smart cities in India, Gopal emphasised that the capital city should cater to the following basic needs of every household — potable drinking water, sanitation, waste management, and access to urban transportation. “The funds should be used towards functionality and not grandiosity. Andhra has lost 10 years already waiting for a capital. So, what is needed now is an artful solution with technology aiding ease of living. The master planning has to be done with care and funds must be used judiciously” she said.

Commenting on the Polavaram project, economist Papa Rao said the NDA government in the state should take precautions to ensure the multi-irrigation project does not turn out like the Kaleshwaram lift-irrigation project in Telangana.

The Central Water Commission should be involved right from the beginning to avoid any mishap later on, Rao said.

“The project has been pending for nearly five decades. It would have been a lifeline for both the Telugu states if this project had been taken up earlier. However, with the Centre proposing to fund it entirely, it could free up some funds for welfare initiatives for the nine backward districts in the state.”

Deepika Amirapu is a freelance journalist based in Hyderabad. Each week, Southern Lights examines the big story from one of the five states of South India.

 

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