Amaravati Capital Project Gets ₹13,500 Crore Loan from World Bank and ADB

In a significant step forward for the development of Amaravati, the capital city of Andhra Pradesh, the World Bank and the Asian Development Bank (ADB) have agreed to grant a loan of ₹13,500 crore for its development. This financial support is aimed at creating a sustainable and inclusive city with improved infrastructure and governance. The loan agreement was finalized following a series of negotiations between the Andhra Pradesh Capital Region Development Authority (APCRDA), the World Bank, ADB, and the Union Finance Ministry.

Key Highlights of the Loan Agreement

Loan Details: The World Bank and ADB will each provide ₹6,750 crore (US $800 million each), amounting to a total of ₹13,500 crore for the Amaravati development project. The remaining funds will be covered by the state government, supported by the central government.

Project Focus: The loan will support various development initiatives, including the construction of trunk roads, utility ducts, stormwater drainage systems, flood mitigation structures, green spaces, water supply systems, and public buildings designed with green standards. Additionally, the funds will strengthen governance and financing frameworks in the region.

APCRDA’s Role and Future Plans

Implementation Agency: The APCRDA has been designated as the implementing agency for the project, tasked with managing the loan funds and overseeing the development activities. The state government has issued an order for APCRDA to ensure the timely allocation and transfer of funds to advance the city’s construction.

State Budget Allocation: The state government has allocated ₹3,445.33 crore for Amaravati’s capital development in its annual budget, with ₹3,000 crore dedicated to infrastructure, ₹400 crore for annuity payments to farmers under the land pooling system, and other allocations for smart city initiatives.

Past and Present Efforts

Previous Loans and Investments: In the past, the state government has secured other loans, including a ₹11,000 crore loan from the Housing and Urban Development Corporation Ltd (HUDCO). The total funding requirement for the city’s development is estimated to be ₹23,000 crore, which will be mobilized through loans, bonds, and central grants over the next few years.

Summery of the News