HomeNewsAP Govt cancels its agreement with SAIH

AP Govt cancels its agreement with SAIH

Andhra Pradesh government has reportedly cancelled the contract with Singapore Amaravati Investment Holdings (SAIH). SAIH was engaged in the start-up area development of 6.84 square km area in Andhra’s proposed new capital, Amaravati. This decision of the state cabinet further deepens the suspense over the fate of various contracts awarded by the previous state government headed by Shri Chandrababu Naidu.

Amaravati was the ambitious and pet project of the previous Chief Minister of the State, Shri Chandrababu Naidu. After the division of the state in 2014, Andhra had to look out for new capital and it was decided to build the same on the banks of Krishna river on 684-sq.km of farm and village land. The task of designing new capital was given to world renowned architects, Foster and Partners. The assignment included the design of two key buildings: the legislature assembly and the high court complex, along with several secretariat buildings, where the offices of state administration were to be located.

However, a state of uncertainty loomed over the fate of capital city project once the Y S Jagan Mohan Reddy government took over the reign of the state in May. The new government brought all development works in Amaravati to a halt after it came to power on May 30, 2019. The new government set up a committee of experts for a review of the developmental plans initiated by the previous government and to suggest a comprehensive strategy for all round development.

It may be recalled here that the former chief minister, Shri Chandrababu Naidu, had promised to model the new city after Singapore and had inked two memorandums of understanding with the consortium backed by Singapore. The new government had shown its disinterest in the project right from the beginning. For example, in its first budget, the new government had allocated just Rs 1,000 crore for the Amaravati project whereas expectations were at least for Rs 5,000 crore.

Earlier, the project had received setback when World Bank had opted out of the project. World Bank had promised USD 300 million for the project but in 2018 it withdrew from the project citing farmers complaint about police intimidation.

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