Amaravati: Andhras New Capital

decided to pay
Rs 2,500 cr
 FM Calculations
Overall RD 7303 cr

On 1 April, 2015, Andhra Pradesh Chief Minister Mr. N Chandrababu Naidu announced that the
states new capital city will be named after the historically significant city of Amaravati.

In 2014, following the separation of Telangana from the state of Andhra Pradesh, both states
had agreed to retain Hyderabad as a joint capital for a decade.

It became apparent, though, that Andhra Pradesh would eventually need a new capital.

This caused much dissent since Hyderabad, the capital of undivided Andhra Pradesh, had a
robust economic and infrastructural foundation and is considered one of the prominent IT
hubs of India.

CM Naidu plans to build Amaravati into an enviable modern city with state-of-art
infrastructure.

The proposed capital city of Amaravati is located in central Andhra Pradesh, somewhere
between two main cities Guntur and Vijayawada.

The name of the proposed capital is derived from the ancient city of Amaravati, which is also
located in the same region.

The Andhra cabinet not only approved the name of the capital but also gave the nod to the
master plan (first phase) prepared by the government agencies of Singapore
The Golden Legacy of Amaravati

According to ancient Hindu legends, Amaravati is the capital of Svarga (roughly translated in
English as heaven).

The ancient city of Amaravati was the capital of the Satavahana dynasty that held sway over
much of the Deccan region between 230 BCE and 220 BCE.

The city of Amaravati, by way of its links with the Satavahana Empire, is steeped in Telugu
history and heritage.

The city of Amaravati had also been a prominent centre of Buddhist studies in the 2nd
century BCE.

The famed Buddhist Stupa of Amaravati is believed to have been commissioned by Emperor
Ashoka himself.

The stupa is very well known and is inscribed with panels depicting stories of Buddha.
The city of Amaravati saw golden times as part of the Vijayanagara Empire. Under the Hindu
rulers of the region, the Amareshwara (Shiva) temple of the city gained much patronage.

Plans for the New Capital

City has both vaasthu balam and nama balam, indicating that both the name and the
location are auspicious.

The government of Singapore has come forward to help construct this new city, which will be
the worlds best city.
 Among the initial plans in place for the new capital is a 200-km highway connecting it with
the major cities of Vijayawada and Guntur.

Two ring roads and a number of radial roads are likely to be built to connect the city with all
the important towns of the state.

Amaravati will also have excellent road connectivity with Hyderabad, Chennai, Kakinada,
Bangalore, and Kurnool.

The New Delhi-Hyderabad freight corridor is likely to be extended to Amaravati.

Mangalagiri is likely to be the site for the nearest airport.

The funds required to build this city are estimated at about INR 20,000 crore.
Why a New Capital City?

Why does Andhra Pradesh need a new

new city to be constructed as a capital? Why could not a
major city such as Vijayawada or Guntur have been chosen as the capital?

The construction of a new capital city also poses a number of challenges.

Hundreds and thousands of acres of fertile agricultural land will have to be sacrificed in the
effort. This may take a massive toll on Andhra Pradeshs agrarian economy.

How much this affects Indias rice production is also to be seen, since the state is one of the
largest producers of rice.

The site
ite chosen for Amaravati is rich in natural resources.. Preservation of these resources will
decide the ecological harmony of the region in decades to come.
Capital Region:

The Core Capital Region of the new capital city of Amaravati, proposed to be taken up in
Guntur district of Andhra Pradesh, will come up on the Krishna riverfront and spread over 16.9
sq km area.

Phase one of the capital city would be completed by 2019 and would serve a population of
about 40 lakh people when fully developed. Based on the smart city framework, the capital
plan will be Vaastu compliant.

The core capital city area will host the State Secretariat, Legislative Assembly, Raj Bhavan,
and other key infrastructure required for the capital city.

The proposed capital will have a metro rail passing through with transit-oriented
development along its network and core areas. Buildings are expected to come up on the
waterfront.

It is proposed to have a metro network of 135 km when fully developed.

The State Government has taken up the process of land pooling wherein it expects to have a
pooled base of 33,000 acres of land for the capital city development.

The Capital Area Region Development Authority has been mandated to pool land for the
capital city.
 The Andhra Pradesh Government has notified 700 acres under land pooling for the
development of the Amaravati core capital development.

The notified area comes under 10 villages of Thullur mandal of Guntur district of the State.

While the State Government has entrusted the task of pooling 33,000 acres in the Guntur
district to the Capital Area Region Development Authority, so far farmers have given consent
for land pooling for about 31,000 acres, the Government has announced

The government has promised to give farmers land compensation in two parts - residential
plots close to the existing villages and commercial plots near administrative buildings and
recreation centres.

The Centre is reportedly unhappy that the government of Chandrababu Naidu diverted some
of the `850 crore released by it for the construction of important government structures such
as Raj Bhavan, Assembly and the Secretariat in the core capital

As per the original plan, the core capital area was to be 8 sq km. This was changed to 16.9 sq
km in the final master plan. Now, the government is planning to further extend this area. If the
area is again increased, around 10-15 more villages will vanish

The state government did secure the Centres approval for its master plan to construct a seed
capital over an area of 16.9 sq km. Now to expand the area further, it will have to approach the
Centre again. It will also have to, if the Centre should give its nod, hand over the project to a
contractor chosen on the basis of a Swiss Challenge

Andhra Pradesh will take the help of two Singapore companies to build Amaravati as a
world-class capital

The State government has already made plans to select the master developer of the seed
capital project by the Swiss Challenge method. Two Singapore companies -- the Ascendas-
Singbridge group and Sembcorp Development Ltd -- are learnt to have expressed interest in
the project

Sembcorps urban development division builds industrial parks, integrated townships, and
commercial and residential spaces.

The Singapore government has a 74.5% stake in the consortium.

The consortium has offered a 42% stake to Amaravati Development Company, a special
purpose vehicle (SPV) of the state government.

The SPV and the Singapore consortium will jointly develop the core capital area.
Swiss Challenge method Amaravathi

The Swiss challenge is a bidding process whereby an interested private player first hands in an unsolicited
bid for a public project. This bid is then made public and more players are invited to better the original bid.
In many cases, the firm that made the original bid, outdoes its initial bid and ends up bagging the contract

According to the plan, the capital region will be spread over 7,420 sq km of which the
capital city would occupy 217 sq km. The plan envisages an area of 6.84 sq km or 1,691
acres to be the first to be developed. This core area will contain within it the
Assembly, Secretariat, Raj Bhavan and High Court buildings.
As per the provisions of the Swiss challenge, the Naidu government announced e-bids
for competing counter proposals from other interested parties for the first phase of
development of the new city

The state government will follow the Swiss Challenge method to build the greenfield capital
city. This means that the proposal submitted by the Singapore consortium will be challenged by
other potential master developers. If the competing proposal beats the one proposed by the
Singapore consortium, the mandate to build the capital goes to the other party.
 Andhra Pradesh is also working with the Japanese government.

The Japan Bank for International Cooperation (JBIC) and the state finance department signed
an in-principle agreement in October for capital development and industrial development.

The master developer will be responsible for developing 6.84 sq. km, or around 40% of the
core capital area.

The state government will hand over 1,691 acres to the master developer in three phases

Of the 1,691 acres, 50 acres will be given at a nominal price. The consortium has offered to
pay Rs.4 crore an acre for 200 acres under the first phase of development, noted Naidu.

The Singapore-based companies have already designed three masterplans for Amaravati,
covering three areas: seed capital (16.9 sq. km), capital city (217 sq. km) and capital region
(7,420 sq. km).

Urban planning consultancies Jurong International Holdings Pte. Ltd and Surbana
International Consultants Pte. Ltd developed the masterplans, released last year.

A revenue-deficit Andhra Pradesh is building a capital from scratch following the creation of
the state of Telangana in June 2014. The state has time till 2024 to build its capital, before the
current joint capital, Hyderabad, is transferred to Telangana