Amaravati or Bhramaravati?

  • Questions Vundavalli Arunkumar

The following is the full text of booklet release by VUNDAVALLI ARUNKUMAR Former MP at Somajiguda press club on Saturday





(Former Member of Parliament)

27 August 2016

Andhra Pradesh was bifurcated after a prolonged agitation for a separate State of Telangana. The Andhra Pradesh Bifurcation Bill 2014 was not properly drafted by the UPA government nor was it properly passed by the Parliament. The Opposition Telugu Desam party (TDP) first gave a letter of consent to bifurcation but later did not do anything to safeguard the interests of the people of the residual State of Andhra Pradesh. The TDP should have tried to improve the Bill by demanding more favourable provisions to be incorporated in the Bill. The tactic followed by the TDP was to make noise in Parliament and blame the Congress party for all the lacunae. A�One good provision the Bill had, however, A�was to make Hyderabad city a joint capital for ten years. There was enough time for the TDP government that came into being after the 2014 general elections to plan for a beautiful capital city in consultation with all the stakeholders. The Union government is bound to assist in the building of capital city as well as Polavaram project.A� The Union government had also appointed a committee of experts under the chairmanship of Sivaramakrishnan to suggest the location of the capital.

AP Chief Minister Nara Chandrababu Naidu was in an unseemly hurry right from day one. He did not wait even for one year before moving out of Hyderabad and started talking of ruling from the new capital city of Amaravati which is still only on the paper. He did not wait for the report from Sivaramakrishnan Committee before announcing the location of the capital city. He appointed his own committee with businessmen and TDP leaders most of whom were either crony capitalists or yes men. They are in no way comparable to the experts on the committee headed by Sivaramakrishnan.A� By any stretch of imagination a capital city would be needing an area measuring not more than 5000 acres. Naidu did not deem it necessary to disperse the government offices all over Andhra Pradesh as recommended by the experts committee. Sivaramakrishnan Committee had suggested that the High Court can be built at Vizag and there have to be three or four growth centres in North Andhra and Rayalaseema. But Naidu unilaterally decided that the new capital city would come up near Guntur and Vijayawada cities and it would be named Amaravati, the ancient capital of Satavahanas. The location is something the expert committee ruled out because the lands there are fertile yielding three crops round the year. Naidu had different plans and a hidden agenda. He started mobilizing vast tracts of land in the name of the capital. He also indulged in speculation in land prices by spreading rumours on the location of the capital city thus helping his friends and followers to buy or sell lands to make money. He reportedly a�?pooleda�� about 32,000 acres. He proposed to pool one lakh acres for the port near Machilipatnam. Instead of getting the design of the capital city prepared by our own renowned engineers, he started shuttling between Andhra Pradesh and Singapore calling latter a clean and corruption-free country. He told the people that it is an honour to do business with such a reputed country. He berated our engineers saying that they are capable of constructing only slums. His mania for anything foreign has led him to concede lion share to the private companies in Singapore by agreeing to 42:58 ratio between Andhra Pradesh and the consortium of the private companies of Singapore. Naidu had decided to go for Swiss Challenge model for allotting contract of work. People have a lot of misgivings about the way Naidu has been going about pooling lands and giving them away to Singapore companies for a song and agreeing for provisions which are not favourable to Andhra Pradesh. One does not know where does the Union government stand in the transactions between AP and Singapore companies. There are doubts about the strength of the fundamentals of the companies that Naidu has been praising to the sky. Does Naidu have personal interests in hurrying things up in an indecent manner? Why is Naidu so particular to do business only with Singapore companies that have no good reputation? Is it true that Singapore has become a notorious route after Philippines and Mauritius for money laundering? Why was Naidu visiting Singapore even when he was in opposition? These and many other doubts have been bothering the people of Andhra Pradesh. I have attempted to gather factual information regarding building of the capital and the interests of Naidu and his friends that are dictating the road map. The whole effort is meant to throw some light on the happenings that are going to have long-term consequences. Since things are done in a secretive manner without any transparency and decisions are taken without any deliberation in the Cabinet meetings or Assembly sessions, it became necessary to put in an extra effort to explain critical aspects of the story of building of the capital city. Rather, it is about how not to build a capital city. A�I have also appended an article published in the Hindu which was written by Sivaramakrishna some weeks before his demise. It shows his hurt and frustration. There is no point in wondering whether it is going to be Amaravati or Bhramaravati without going into the details. My attempt in this booklet is to discuss the details which are sought to be shoved under the carpet by the powers that be. As they say, the devil is in the detail. Let us see.


The Congress Working Committee (CWC) in its Resolution dated 30.07.2013 resolved to take steps in accordance with the Constitution of India to form a separate State of Telangana. The Resolution also covers the issue of Capital by stating that Hyderabad will be a Common Capital for both the States for a period of 10 years after the formation of State of Telangana, and also to assist in building up a New Capital for the residuary State of Andhra Pradesh within a period of 10 years. With the above Resolution the issue of division of the State in principle has been accepted and steps for formation of a separate State for Telangana were put in place. In continuation of the same, the Parliament passed the Act for Re-organization of the State of Andhra Pradesh which was gazetted on 01 March 2014 and the appointed day was fixed as 2 June 2014. The Act also makes a reference to Hyderabad being a Common Capital for a period not exceeding 10 years and after 10 years Hyderabad shall be the capital for State of Telangana and there shall be a new capital for the State of Andhra Pradesh. Section 6 provides for Union government to constitute an expert committee to study various alternatives regarding new capital for the successor State of Andhra Pradesh and to make appropriate recommendations within six months from the date of enactment of Re-organization Act. Though the Congress Working Committeea��s resolution as well as the Reorganization Act do provide for Hyderabad to be a common capital for a period of 10 years, once the intention of bifurcation of the State became clear, the search for a new capital for the residuary State of Andhra Pradesh already began and lot of guess work and activity in that direction was going on in the interim period. There were competing claims for the New Capital City for the State of Andhra Pradesh and the regional factors, the political issues got intermingled with these demands. This book tries to cover the process of formation of the State capital and how finally Amravati (Bhramaravati?) was selected as the place for new capital and whether it is a right choice and whether all the available options have been fully exhausted before zeroing on Amravati as the capital city.


Like all other ethnic groups, Telugus are united by language and have long history dating back to Vedic period. The real consolidation of this linguistic ethnic group began with the ascent of Satavahanas between 2nd Century BC and 2nd Century AD during which time they ruled from the banks of Krishna River from the city of Amravati and their Kingdom extended at its zenith covering parts of the present day States of Gujarat, Madhya Pradesh and Odisha. After the Satavahanas there was a decline and the second major consolidation of the Telugus was under the Kakatiyasa�� who ruled from Orugallu (Warangal) and their rule was at its heights during 12th to the 14th Century covering most of the areas where Telugu is spoken as a language. Another important dynastry which ruled Telugu people in between Satavahans and Kakatiyas A�was the dynasty of Eastern Chalukyas. It ruled between 7th and 12th Century from Vengi in the present-day West Godavari and subsequently from Rajamahendravaram on the banks of Godavari. Though they had limited area of administration, the dynasty is important from the point of view of pioneering written Telugu literature with Nannaya, the Poet Laureate of Raja Raja Narendra, starting translation of Mahabharatha from Sanskrit into Telugu in 11th century. After the fall of the Kakatiya dynasty, again the unification of Telugus happened under the Vijayanagara empire and the whole of the area which is now called Andhra Pradesh after bifurcation is ruled by the Vijayanagara dynasty from Humpi which is presently in Karnataka State. At the same time, the present day Telangana area was ruled by the Qutb Shahi dynasty from Golconda during this period. The Telugu speaking people thus had two capital cities- one at Golconda and another at Humpi- during this period. After the fall of the Vijayanagara dynasty, the next important event was the establishment of English settlement at what is now called a�?Chennaia�� which was then known as a�?a��Chennapatnama��a��. This particular area was interestingly given to the British by the King of Chandragiri which is now part of Andhra Pradesh State in the district of Chittoor. The British slowly established their power over the Coastal Andhra including the present Tamil Nadu area and started administering it from Chennapatnam which was later called Madras. The administrative area was Madras Presidency. In 1802, after the Nizam of Hyderabad ceded five districts to the British under a subsidiary alliance, Madras became the capital for the present day residual State of Andhra Pradesh along with Tamil Nadu, parts of Karnataka and Kerala which were known as the Madras Presidency. The State of Hyderabad under Nizam continued with its capital at Hyderabad. The capital was shifted from Golconda to Hyderabad during the Asaf Jhahi dynasty. After India gained Independence in 1947 consequent on Police Action in 1948 Hyderabad became a separate state within the Indian Union while the present day residuary state of Andhra Pradesh continued to be part of the Madras Presidency. In 1953, consequent of the hunger strike launched by Sri Potti Sriramulu and his death, a separate Andhra State was formed and the issue of the capital for the new State came to the fore. Since the Madras City itself was given by the then Chandragiri King to the British and as there is a 50:50 population ratio between Tamils and Telugua��s in the city of Madras, a strong claim was made to continue Madras as the capital of Andhra State. This was vehemently opposed by the Tamils. Jawaharlal Nehru who was a great visionary in all other respects, failed to take a decision with vision which could have avoided a number of problems at a later date. Since Madras was the capital of Madras presidency in which several linguistic groups were living, if only he declared Madras city as a Union Territory and allowed it to continue as Capital for both Andhra State as well as the then Madras State (Tamil Nadu), much of the problems which subsequently arose could have been avoided. Similar approach with reference to Bombay also declaring it as Union Territory allowing it as Capital for both Gujarat and Maharashtra would have ensured these cities progressed well as multilingual, multi-cultural centres of growth. Unfortunately, it did not happen and in the dispensation that was given, Madras (Chennai) went to the present-day Tamil Nadu and as there was no choice for Andhras other than looking for a new capital of theirs. Thus the first struggle for a place to be the capital of State started in 1953.


Those were the early days when communism was the major trend in the State of Andhra Pradesh and Vijayawada was a major centre with growing influence of communism. Whether this factor weighed with the then Chief Minister Prakasham Panthulu or it was the strong lobby from Rayalaseema who were his main supporters, he preferred Kurnool to be capital compared to Vijayawada. Vijayawada made a strong pitch to be the capital of the State at that time, but could not really succeed and the Assembly voted for Kurnool as the capital. The three locations which seem to have come for consideration were a�� Tirupati, Vijayawada and Kurnool. North Coastal leader Gouthu Latchanna supported Tirupati as the capital but in the end Kurnool was decided as the capital by the undivided Madras Legislature where Vijayawada lost by a single vote in which five non-Telugu Members also participated. Hence, Vijayawada which should have been the capital for the State of Andhra in 1953 lost out to Kurnool, due to a strong leadership from Rayalaseema in the shape of Sanjeeva Reddy, fear of communist for whom Vijayawada was a major base. The capital at Kurnool was short-lived and with the formation of State of Andhra Pradesh in 1956, the capital shifted from Kurnool to Hyderabad and continued to be the capital of undivided Andhra Pradesh till bifurcation in 2014 and the formation of the residuary State of Andhra Pradesh.


The Andhra Pradesh Re-organization Act provides for Hyderabad as common capital under Section 5 of the Act. While providing for this particular facility, if the Central Government has declared Hyderabad as a Union Territory, there would never have been a search for separate capital for the State of Andhra Pradesh. Hyderabad city could have continued as the Capital for both the States till the people of residuary State of Andhra Pradesh felt they need to have a separate capital within their own territory. Unfortunately, the Act does not provide for any such provision to declare Hyderabad as Union Territory. Furthermore, the Act does not provide enough safeguards to protect the interests of another government running from Hyderabad. Though efforts were made to have certain special responsibilities and powers for the Governor, they were more in terms of mere utterances without necessary teeth and mechanism to protect the interests of both the governments. In effect, after the bifurcation of the State was done, Hyderabad virtually came under the control of Telangana Government with the police machinery totally reporting to the Telangana State Government, the Revenue and Municipal Administration also working under the Telangana Administration. Further, there was strong resistance from Telangana to operationalize Section 8 even to the extent it was mentioned in the Act and there was also no genuine effort from Government of India to operationalize Section 8. Even if it was operationalized, the way it was structured could not have facilitated an environment for a different State Government to function independently from the city of Hyderabad. Hence, the need for looking for a separate capital in right earnest started far before the Appointed Day.


Any capital city which is going to be built anew should emerge out of proper consensus of all the regions so that it is owned up by people of all the regions of the State. There are different models of a capital city across the Word. Wherever historical cities have come up, capital cities have also functioned as the administrative units, the cultural centres, the commercial centres and the economic lifeline of that particular country or State. The examples are cities like London and Paris with which the economic cultural administrative life of that particular country is inter-oven. In the new world where new cities have been established and developed a different model has been followed either for the country or for the new States. A�Capital cities are located purely as administrative towns where from the administration is run whereas the more flourishing commercial and financial cities happen to be different. For example, Washington DC is the Capital City of United States of America while the rich commercial hub is New York. Similarly, for the State of California, Sacramento is the capital whereas the real thriving cities are San Francisco and Los Angeles. Similarly, in Australia, the thriving major cities are Sydney and Melbourne whereas the administrative capital is Canberra. Since Andhra Pradesh, a residuary State, is embarking on building up of a new capital with existing thriving metro cities of Vizag, Vijayawada and Tirupati, it would have been in the best interests of the regions as well as the State to have gone in for the second model of having an administrative capital from where the business of the administration is run while developing the metros of Vizag, Vijayawada and Tirupati as major commercial hubs. Secondly, as could be seen for the struggle for the Capital in 1953, the residuary State of Andhra Pradesh is not administratively and culturally a homogenous unit. The Rayalaseema sentiment and North Andhra sentiment are equally important and need to be accommodated for any state capital to be acceptable to the people of all the regions. Vizag which was not a major town in 1953 has become a very important commercial city for the State of Andhra Pradesh and in 2014 is an important town for considering location of the Capital. Hence, by the time of bifurcation there were competing claims from Vizag, Vijayawada and Tirupati for the location of the capital. Kurnool also made a pitch to be considered as a city for establishing the capital based upon the historical fact that it was the capital of the State of Andhra in 1953. Whenever public investment is made, one of the major points that need to be considered is whether the money can be spent in less endowed poor areas so that it will have a much better multiplier effect. Capital city construction is going to be one such major investment decision. Keeping all these things in mind it was thought that once the Siva Ramakrishnana��s recommendations come a final view will be taken about the location of the capital. Before the Appointed Day and days before the general elections, there were different rumours about location of the capital in places like Macherla, Vinukonda, Donakonda. I also heard that some important political leaders have already bought lands in these areas and gave an impression that Capital is to be located in one of the above places. It is in this context, after the date of bifurcation Nara Chandrababu Naidu having been elected as Chief Minister of Andhra Pradesh has come to play a major role in terms of location of the capital.


The Sivaramakrishnan Committee was appointed by Government of India, before the Appointed Day of bifurcation and before the elections on 28 March 2014 and they were asked to submit a report by 31 August 2014. Chandrababu Naidu, after taking over as Chief Minister of Andhra Pradesh, did not wait for the report of SivaramaKrishnan Committee. A�He, instead, went ahead with his own plans and constituted a separate team of Industrialists to decide the location of the capital. In between the Appointed Day, 2 June 2014, and the day on which it was decided to locate capital near about Krishna River, in the vicinity of Velagapudi village, a lot of confusion followed with rumours floated deliberately or otherwise suggestingA� that the capital city is coming at Nuziveedu, by de-notifying forest areas near A�Nuziveedu, between Guntur and Vijayawada in the Nagarjuna University building , the Special Armed Forces Reserve Area or near A�Mangalagiri, by de-notifying forest lands. There are allegations that these rumours are spread specifically to facilitate certain leaders to make money by speculatively buying and selling lands in these areas. In fact, the genesis of the so called A�a�?Call Money Racketa�� of Vijayawada, can be traced to the speculative buying of lands in Nuziveedu thinking that the capital city is going to come up there. Thus the deliberate leaks, rumours allowed to float on the location of the capita in a particular area and allowing them to circulate, without denial, A�in certain sections of media did give rise to a lot of real estate speculation in and around Vijayawada. Who planted the rumours? Who allowed them to spread and rule the roost? Who were the beneficiaries of this dangerous, calculated, clever strategy? Only a detailed and impartial enquiry can establish the facts. A decision on locating the capital at Tulluru area would have been taken somewhere in June after Chandra babu Naidu was sworn in as CM. But, it was kept secret for four months allowing speculation to play havoc. It was only after a Cabinet Sub Committee was formed for working out modalities of land pooling in last week of September 2014 and capital city area was declared under Act that the rampant speculation was put to rest. Thus the speculation on capital city had a free run from June 2014 to last week of September 2014- for full four months- creating confusion and allowing speculators to make money by duping gullible middle class. The long period during which the location of capital city was left guessing and the total silence from governmenta��s side during this period and deliberate leaks had contributed to an all-round confusion on location of the new capital allowing speculators in real estate a field day. Finally, even when a resolution was moved in the Assembly as late as 3 September 2014 and Chief Minister Chandrababu Naidu announced the Cabinet decision in the Assembly it was not clear where the exact location of the capital city would be. The resolution stated that the capital city would be located in a central place around Vijayawada without specifying the area, thus allowing the speculation to continue. The interim period which was deliberately left open for people to guess the exact location of the capital city led to unprecedented speculative land deals in and around Vijayawada, which have resulted in ruining of number of families. Only those who knew that ultimately the capital is going to come in the Tullur mandal and who had inside information, made strategic investments. Those who did not have access to critical information, had invested in different areas only to lose their capital very badly. Hence, Chief Minister Chandrababu Naidu alone would be responsible for all the speculative real estate business that went around Vijayawada city between 2 June 2014, the Appointed Day, and the last week of September 2014 by which time the exact location of the New Capital City was decided. Why this game was played? To benefit whom?A� Who are the real beneficiaries?A� Answers to these and many other nagging questions have to be known to the public of Andhra Pradesh, if not today, some other day in future. It is a known fact that in the process certain people with inside information have been benefited whereas large number of general public based upon these shifting locations of capital rumoured through certain sections of media and others, made investments and lost heavily.A� To this extent, the location of capital in Andhra Pradesh has been shifting from place to place destroying a large number of people while benefiting a select few. The Sivaramakrishnan Commitee and the State Advisory Panel, The AP Re-organization Act U/s. 6 provides for, constituting an expert committee to study various alternatives regarding the new capital for the successor State of Andhra Pradesh and make appropriate recommendations within six (6) months from the date of enactment of this Act. Pursuant to this, Government of India constituted Sivaramakrishnan Committee on 28 March 2014 directing it to submit a report before 31 August 2014. The Committee consists of eminent experts in the field and is headed by Dr. Sivaramakrishnan, who was the former Secretary of Government of India, Urban Development and is Chairman of the Centre for Policy Research and is a known figure in the field on Urban Development. It also had other eminent persons like Ravinder Naik from School of Planning and Architecture, Aromar Ravi, Director, Indian Institute of Human Settlement, Rathin Roy, Director, National Institute of Public Policy and Finance, Jagan Shaw from the National Institute of Urban Affairs. Hence, it is a very eminent Committee representing who is who in Urban Planning and Urban Development and was entrusted with the task of finding a suitable location for the new capital city. In fact, the Terms of Reference to the Committee include least possible dislocation to the existing 16 agricultural systems, preservation of local ecology minimizing the cost of construction and land acquisition and careful assessment of natural disasters. This Committee, which has submitted its report by the deadline of 31 August 2014, has categorically come out with a recommendation that single mega location for capital is unnecessary for the new State and the committee does not consider single large capital city as a feasible option to Andhra Pradesh as of now. They have also gone on record to state that State government did not indicate list of availability of land in places like Vinukonda, Donakonda and Macherla and hence, they could not examine these locations. In effect, since the State Government has for its own reasons decided on the location of capital independent of the Sivaramakrishnan Committee, they have not shared information with them to examine and suggest alternative locations for the Capital City as per the mandate given to them by Government of India. Sivaramakrishnan Committee had also mentioned that geographical centrality is an attractive concept but need not be the only consideration for locating capital city and went on to state that other States like Tamil Nadu, Kerala, Maharashtra and West Bengal do not have their capital cities located centrally. The Committee, in fact, mentioned that concentration in Vijayawada-Guntur area would strain the infrastructure and will lead to unplanned expansion of urban area, overconcentration of this land near Vijayawada-Guntur what is now called Amaravati, they felt that it will affect the development prospects in other areas by crowding Capital investment in this area. Added to that, any such concentration in one area is likely to have a�?honeypota�� effect similar to Hyderabad. The Committee, in fact, ruled out the present day Amaravati area as a possible site for locating the capital city stating it is high value agricultural land with high water level and hence there can be problems of foundation and soil bearing capacity can be a major problem. They very clearly recommended a decentralized development pointing to three Development Growth Centres of Vizag Region, Rayalaseema arc consisting of Anantapur, Tirupati, Kadapa, Chittoor and Kurnool, Srikalahasthi, Nadikudi spine and gave a possible location of different departments in different regions. Their finding was that replicating of all the offices presently functioning in Hyderabad in only one place in Andhra Pradesh will only be an action of hurried expediency and convenience rather than careful and deliberate choice. They suggested High Court to be located at Vizag and gave a list of different areas where different government departments can be located. The total land requirement for the new capital as estimated by them is about 1500 acres and for the whole capital construction including the infrastructure for the Secretariat, High Court and the Assembly would be of the order of about 12,000 crores including the required necessary infrastructure. Hence, a very competent Committee of professionals appointed by Government of India has categorically rejected both the idea of a centralized capital with all facilities at one place as well as Amravati area as a choice for location of the Capital. It is not correct to say that Sivaramakrishnan Committee has not suggested any particular place to be the capital as was propagated by the State Government at that point of time. It is a fact that the State Government refused to share information with them on land availability at Macherla, Vinukonda and Donakonda and hence restricted their recommendations with reference to alternative locations for the capital of Vinukonda, Donakonda and Macherla. This was clearly brought out in the report of Sivaramakrishnan Committee. On the other hand, the State government during that period widely publicised that Sivaramakrishnan Committee did not recommend any one place for the capital. In any case, the committee very clearly and categorically ruled out Amravati region as a Capital region for the reasons stated above. Hence, the action of the State government in locating the capital city at Amravati in highly fertile wet lands, where the soil bearing character of the land is questionable is totally contrary to the recommendations of the Sivaramakrishnan Committee. Further, Sivaramakrishnan Committee made recommendation for decentralized location of government functions and functionaries to avoid a�?a��honeypota��a�� effect of Hyderabad. The a�?a��honeypota��a�� effect can be described in simple words as a huge concentration of all functions of the government at one place which would attract more and more and make it a big concentrated place of development to the detriment of other cities and other regions. Keeping in view the diversity that is present in the State of Andhra Pradesh, Sivaramakrishnan wanted to avoid this effect and wanted a distributed division of administrative set-up covering Rayalaseema, North Coastal and Central Coastal and Southern Coastal areas. This was totally given a go-by and a decision was taken by the State government without considering the expert panela��s recommendations in a hurry without proper application of mind for reasons which I will be elaborating in subsequent chapters to locate the State capital at Amaravati area which has resulted in huge amount of problems that we are facing with this construction of capital city at this particular place. While the Sivaramakrishnan Committee was busy with its work to submit its recommendations after the new government came to power in 2 June 2014, the Chief Minister appointed an Advisory Panel on State capital in the last week of July 2014. It is well known that the Sivaramakrishnan Committee will have to submit its Report by the end of August but in a hurry ignoring the existence of expert committee set up by Government of India, another Committee was constituted by the State Government under the chairmanship of Municipal Administration and Urban Development Minister Narayana, the other members being Sri Galla Jayadev, Sujana Chowdary, Sanjeeva Reddy of GVK Group, Prabhakar Rao Nuzvid Seeds Srinivasa Raju of Peupil Capital and Sri Grandhi Mallikharjun Rao of GMR group. The Committee in the ToRA� (terms of reference) was to advise on founding a vibrant, diverse and inclusive city, efficient use of natural resources and use of green technologies for smart and sustainable urban development. While the Sivaramakrishnan Committee consisted of eminent personalities in the field of Urban Development, this particular Committee is packed with TDP functionaries and crony capitalists. It is just a farce and eyewash committee to give a recommendation of an already decided establishment of the capital city in Amaravati region area. None of them can match the expertise of Sivaramakrishnan Committee nor is this a serious committee to really look into issues and give any recommendations. I have searched the whole of web to see what type of recommendation they have given, but not able to locate one. Based on this committee recommendation, the CM made a statement in the Assembly on 09 April 2014 that the new capital of the State would be located around Vijayawada and finally the location was zeroed in on the Guntur District side in the villages of Tullur, Mangalagiri and Tadepalli mandals. All these are right on the River Krishna and are highly fertile lands growing crops all through the year with a high water table and soils less suited for building construction. Hence, by design the most inappropriate area for location of the capital city was chosen against all advices by Chandra Babu Naidu for reasons which are by now very well known to one and all.


Chief Minister of Andhra Pradesh tries to give two important reasons for choosing Amravati as the capital for Andhra Pradesh State. One, A�its central location making it convenient for all to come; it has historical importance in terms of Amravati City which was the capital of Satavahanas between 2 BC and 2 century AD. The second and more obvious reason is not difficult to find. When big public investments are made and there is choice of places, it would be in the interests of the State and of the people if investment goes into area where people are less endowed and are not affluent. The multiplier effect of the public investment is going to be higher for such investments. If for other reasons also such investment is justified, that would be a right decision to take. A place being central is not a major issue as long as connectivity is properly established. Hyderabad was not really central to the State of United Andhra Pradesh but everybody found it convenient to come there. Delhi is not central to the country, but is well connected and is convenient from all parts of the country. Similarly, the capital city of Karnataka, Bengaluru, is located at one end of the State. Same is the case with of Tamil Nadu as well. Mumbai is at one end of the State of Maharashtra and Kolkata is also similarly situated in West Bengal. So this argument of centrality is not a strong argument to locate the State capital at Amravati and is also discussed threadbare and rejected by SivaramaKrishnan Committee. If the historical importance of any area is to be the reason for locating a capital city, we may end up locating the capital cities in wrong places. Any town which was important at one time may lose its importance over a period of time and that by itself cannot be an important reason for locating the state capital. At best we can always name capital city Amravati wherever it is located. The reasons for locating the State capital at Amravati contrary to all evidence suggesting that it may not be the right place and clearly ignoring the Sivaramakrishnan Committeea��s recommendations were other than objective criteria for setting up of a new capital city. When a new capital city for a new State is to be located, any visionary leadership would look for discussions with all sections of population taking everybody with them and locating it in the place which is likely to satisfy all segments of the population. That would be a real visionary leadership which can take the people with different viewpoints together for such a major decision. Such a visionary leadership was woefully lacking in Chandrababu Naidu who always boasts as a visionary, The major reason which is rumoured and certain newspapers have published is that a number of functionaries of the TDP and those who are near and dear to the CM have already made investments in and around these areas and the one way of getting appreciation would be to locate the State capital at this place. But for this reason, there are no other objective criteria to justify location of the State capital in this particular Amravati region.


Having decided to set up the capital city at Amaravati areas, the Chief Minister Chandrababu Naidu has two choices of getting the land required for this purpose. The maximum extent of land required as envisaged by Sivaramakrishnan Committee for the new capital is of the order of 1500 acres. He should have gone for acquiring these 1500 acres of land for the capital city area and left the farmers to dispose of their lands the manner in which they wanted subject to certain zoning regulations. He should have gone for land pooling on a limited scale for these 1500 acres of land from the local farmers making them partners in the development of capital city and left the remaining land to be developed as per the choice of the farmers/owners. He has not chosen either of these better alternatives for the development of the capital city. He went for a model to use the words of Sivaramakrishnan Committee a�?honeypota�� capital city which is mega in nature and is going to be an administrative cultural commercial hub for the whole State. He knows that he needs a huge extent of land for this purpose and that much of an extent of land, there is no way he would be in a position to acquire since they are prohibitively costly lands. Hence he left out land acquisition as a choice for getting hold of huge extent of land for setting up of the capital city. But he has cleverly used the threat of land acquisition as a blackmailing weapon to make the farmers submit into land pooling. A massive exercise was undertaken and about 32,000 acres of land was pooled in to create a huge mass of land for development of the new capital city promising the farmers certain lands under the residential zone as well as commercial zone. If this land pooling was totally free and voluntary it could not have succeeded and should have gone into lot of troubles. Though the Government could have got certain parcels of land in different areas depending upon the farmersa�� willingness and the community to which they belong to get a unified stretch of 32,000 acres would not have been possible. This was cleverly manipulated by threatening farmers that there would be land acquisition if they do not give their land in land pooling; it was the government alone which knows that it does not have that much of funds to go in for land acquisition in case farmers refuse to give their lands in land pooling. Since farmers are not aware all those who are thinking that by not getting into the land pooling, they may have to lose the land through land acquisition and they fell in line and gave the land in a supposedly voluntary manner for the land pooling under the land pooling scheme. This is prima facie an objectionable method of pooling the land and if some of these farmers were to approach court of law, I am sure they will have a strong case as the pooling is not voluntary but under threat of land acquisition. Farmers have been fed on possibly creating returns in terms of value addition in speculative terms to their land once the capital city is developed. Hence, huge speculative activity is presently going on in the capital city area. There are also allegations stating that attempts are made to exclude the investments already made by some of the influential people from land pooling and pooling is only done for the farmers not for those who have invested in this area to reap benefits. Wherever farmers finally refused to come under land pooling, the land acquisition is now being used as a weapon to get hold of those lands. Whether the government will have the necessary funds to pay for all this is a moot point, but by going in for huge land pooling for about 32,000 acres, the government has invited problems for it which will blow up either in the near future or at a later date. The reasons are not difficult to see. The farmers have been promised or fed on possibly huge speculative benefit that they are going to get after the development of the new capital city. That is a city not just an administrative centre but is going to be a commercial, financial and cultural city of a mega nature. They are fed on the belief that such a city would give value to the land that they are going to hold on after the land pooling in terms of commercial and residential areas. The returns that they are foreseeing are highly speculative and totally unrealistic. Once this speculative real estate boom starts losing steam, the farmers are going to lose heavily and the government will have to pay a political price. In fact, government is presently riding a tiger, feeding it on possible future speculative returns and gains. Once people realized the hollowness of the promise, after finding out that all these are unrealistic propositions by any stretch of imagination, there is going to be a virtual revolt in all these villages leading to a major political shock to the present dispensation.


Naidu does not miss an opportunity to talk about the greatness of Singapore, its administration and how there is no corruption in that country. He also talks a lot about their discipline and the way fines are imposed if any violation is done. After eulogizing the greatness of Singapore, he goes on to add that AP will have advantage since it is dealing with Singapore which is non-corrupt. This is a highly questionable hypothesis and the evidence is contrary with reference to the international dealings of this Island State. The main stream newspapers in Andhra Pradesh for commercial reasons carry these statements of the Chief Minister beyond all proportions of their importance and his repeated statement in this regard are carried with a lot of publicity. Granted that Singapore is the least corrupt State in the world in terms of internal administration and there are very few corruption scandals concerning its internal administration. The Island City is run with iron hand by family Oligarchies with high levels of integrity in internal administration but same is not the case in terms of international dealings of this Island State. In 2006, Morgan Stanleya��s Chief Economist Andy Xie remarked a�?actually Singaporea��s success came most from being money laundering centre for corrupt Indonesian businessmen and government officials. To sustain its economy Singapore is building casinos to attract corruption money from Chinaa��a��. US International Narcotic Control Report 2011 observed that stringent bank secrecy laws make Singapore a potentially attractive destination for foreign corrupt officials. In a Report Tax justice network, an international non-aligned network observed that Singapore ranked 5th in 2013 in terms of financial secrecy index which suggests that this is an important centre for wealthy individuals to hide money. It respects domestic Rule of Law while turning a blind eye on foreign law-breaking. According to an article in Fair Observer by Media Asker, Singapore has become a highly strategic location for wealthy Indonesians to store their savings due to its guaranteed confidentiality. The benefits from Investors who conduct business by dredging natural resources in Indonesia are reaped by States like Singapore. In his Article in the Sunday Guardian on 2 May 2015, Abhinandan Mishra remarked Singapore has emerged as the foremost destination for Indian black money, tax evaders are using this tiny nation for investment purposes to turn their black money white and then bring it back to India. In the multi crore Sarada Ponzi scam, officials found evidence that a Trust based in Singapore was used to siphon off the scam money. In a report published by Environmental Investigating Agency in 2007 titled a�?The thousand headed snake forest crimes corruption and injustice in Indonesiaa��, it is observed Singapore government assures confidentiality for those choosing to bank there. Augus Anwar, Head, Bank of Pelitas, charged with stealing US $ 210 million moved to Singapore, obtained citizenship of Singapore. Similarly, Sukanto Tanato wanted for failure of Uni Bank escaped to Singapore. As was observed by narrative report on Singapore by a justice network, Lee Kuan Yew model involves fostering strong respect for domestic rule of law while tolerating foreign law-breaking, money laundering dealing with illicit money that flows from it and a business model that says a�?we wona��t steal your money, but we will turn a blind eye if you want to steal someone elsea��s moneya��. As was observed by New York Times, Nick Leasona��s Baring Bank Scandal in 1995 was a result of the principle of seeing no evil regulation of simex, the Singapore Stock Exchange. Thus, Naidua��s claims that Singapore is free of corruption internally would make it a transparent realistic partner with high levels of integrity to partner in the development of new capital city are highly questionable. The fact that while in office or out of Office Naidu chooses to frequently visit Singapore also raises quite a number of eyebrows in this regard. Given the secrecy code of this country it is very difficult to get to the roots of any scam if this country is involved and it is this country and their firms Naidu wants to take as partners in the development of the capital city. Even with reference to Singapore, ita��s involvement in capital city development kept on shifting from day one to penultimate day. Originally it was proposed as a G to G partnership between Singapore State and State of Andhra Pradesh. They were supposed to prepare the Master Plan free of cost but once the plan was ready the Singapore government backed out and started batting for two major companies of Singapore Semb Corp and ASCENDAS SING BRIDGE as partners for development of the new capital. Out of these two Semb Corp does not have a reputation of fair dealings in its international operations. In the Financial Times dated 15 April 2015 Samantha Pearson while dealing with Petrobars of Brazil that became the largest corruption scandal in Brazil, where former executives of this company are charged with money laundering and remarked that Singapore Keppel and Sembcorp marine are accused of paying bribes to win contracts at the Oil Major. Monica Arruda and Bruce Zaguaris remarked in political capture in Petrobars corruption among the multinationals connected to the scandal by former Petrobars executive are Rolls-Royce and Semb Corp marine etc. If one of the firms does not have clean image and is involved in the Petrobras scandal which is under investigation to assert that since these are companies from Singapore and hence they have high levels of integrity in their dealings is just to fool the public by indulging in false propaganda.


Next, we go to the other aspect of the whole development of new capital city by Swiss Challege method. The Swiss Challenge system is not in operation in the tendering process of Govt. of India till recently. It is not the perfect route for awarding contracts and is not in vogue except in some countries and in some States like Maharashtra and Andhra Pradesh within India. The Kelkar Committee on re-visiting, revitalizing P.P.P. model of infrastructure in its report, submitted in November 2015, felt that unsolicited proposals suo mottu may be actively discouraged as they bring information asymmetries in the procurement process and result in lack of transparency in the fair and equal treatment of potential bidders in the procurement process. Chief Minister of Andhra Pradesh just as he is locating the Capital against the recommendations of the Sivaramakrishnan Committee is also keen on going against the recommendations of an Expert Committee set up by Government of India on procurement process and would like to try the Swiss Challenge method with a proposal submitted by the Singapore companies as the unsolicited suo mottu proposal. Leaving aside the merits of all that whether the proposal of the Singapore companies is an unsolicited proposal is itself a questionable proposition. Swiss Challenge is not a preferred mode in a number of countries and number of States within India. In one case where a project was awarded based on Swiss Challenge to one Ravi Developers by Maharashtra, the issue was carried in SLP to Supreme Court and the Supreme Court in its Judgement in the case of SLP 13149 of 2008 dated 5 February 2009 upheld the Swiss Challenge proposal and laid down certain guidelines for the same and one of the main ingredients was that it should be a bare unsolicited suo mottu proposal. As per the Supreme Court judgment it has to be a suo mottu unsolicited proposal to be considered under the Swiss Challenge. The Andhra Pradesh Infrastructure Development Enabling Act of 2001 also talks of Swiss Challenge saying that the private sector participant should submit an unsolicited or suo mottu proposal and the Act goes on to define the basis of the method as a�?an unsolicited or suo mottu proposal means a Project not already initiated by the government or agency or local authoritya��. Hence, the main issue is that in order to put any project under Swiss challenge, it needs to be a suo mottu unsolicited proposal. But, in this case here, Singapore government which is a close partner with Andhra Pradesh Government in development of Master Plan and all these Companies came as part of Singapore delegations and the CRDA has shared lot of information with them to prepare their Project Report. When Government is an active participant in the preparation of Project Report how can such a Project Report submitted by these two Companies be called suo mottu and put through a Swiss Challenge method is beyond the comprehension of anybody who knows the procedure. The project is likely to face problems in a court of law if somebody is to question it. But with the type of connections Naidu has, one should not be surprised if he is able to see this through in spite of glaring infirmities in the very proposal itself. Thus, there is no great merit as is being propagated by Naidu in going with Singapore Companies nor the process that he has chosen to put this through is legally and technically correct. Time alone will decide how far he would be successful in pushing such an opaque non- transparent system of bidding process to benefit a few at the expense of the others. Even if it explodes as a major scandal, he may be confident that to get to the roots may not be easy given the secrecy index and laws of Singapore government with reference to money of the foreign nationals.


Whenever and wherever there is a speculation or a scam, be it a real estate scam or IPO scam or a Chit Fund scam, it is the middleclass who suffer most. With a greedy mind to reap quick returns, they rush in only to burn their fingers. This happened with the IPO rush and when the IPO Companies got busted, the middle class suffered. Similarly, a number of Chit Funds found the middleclass an easy prey to cheat. In Real Estate also any new project coming up, it is the middleclass who invest and lose. It happened with the rumoured Fab City near Hyderabad, the Lepakshi Knowledge Hub near Anantapur, with the Samshabad Airport real estate near Samshabad. The capital city at Amravati is no better than these scams and may turn out to be the mother of all such scams. Amravati (Yamaravati?) is going to be the biggest scam since it envisages huge speculative activity and is fed on media propaganda, deliberate leaks from government to sustain an unsustainable realty boom. It is rumoured that huge extents of lands in and around Amaravati are owned by influential people. As long as the lands are with them they will find a way of keeping the rates high. But the moment it transfers to the hands of middleclass, who would be eager to encash on any such speculative real estate booms, the prices will fall like a pack of cards leaving them in the lurch. The same is going to happen here. I have a word of caution: it would be better for middleclass not to buy lands in and around Amravati since the type of growth that is envisaged may not really happen anywhere in the near future.


In conclusion it can be said that the bifurcation of the State had given a great opportunity to address the sub-regional feelings within the residuary Andhra Pradesh State and to build a strong United State of Andhra Pradesh meeting the sub-regional aspirations of people from all regions. It was a golden opportunity for any leader with vision to carry people along with him of different regions and political views. The capital city should have really provided such an opportunity of engagement and taking up a capital city construction addressing the interests of all the regions. The a�?expert committee on AP capitala�� headed by KC Sivaramakrishnan consisting of eminent experts has just addressed this issue very effectively and gave absolutely practical solutions. It is the lack of proper visionary leadership of Chief Minister Chandrababu Naidu which is going to land the State in a veritable mess of our own making. Today, Rayalaseema is not willing to own up Amravati as a city so is the case with North Coastal Andhra. Amravati at best is going to be a city of Krishna and Guntur Districts whose fear in 1953 made people like Tanguturi Prakasam Panthulu to think of Kurnool as the capital instead of Vijayawada. Such short-sightedness, partisan politics played today are going to result in deep turmoil in the State of Andhra Pradesh. These differences which were submerged within the political and administrative system of United State of Andhra Pradesh including Telangana are now rearing their head threatening the fabric of new State of Andhra Pradesh due to inept handling of capital city issue by the Political leadership.



The Andhra Pradesh Reorganisation Act, 2014 gives ample time for N. Chandrababu Naidu to concentrate on the larger issues that confront Andhra Pradesh rather than be bogged down by the issue of land for the capital, which seems to be the case now.

I have been an unabashed admirer of Mr. N. Chandrababu Naidu especially with his accomplishments as Chief Minister of undivided Andhra Pradesh (AP) previously. Why? He succeeded in establishing AP as a progressive, information and technology-oriented, modern educational hub. He was motivated in his endeavours, perhaps prompted by the prominence Bengaluru was getting in this regard. In this connection, he had travelled far and wide to summits and meetings to attract powerful entrepreneurs and companies. The GDP which was Rs.1,700 billion at that time during his tenure in the undivided AP, around 1999 (data from theA�EPWA�Research Foundation) is about Rs.4,574 billion now, from 2014. It cannot be denied that much of this was due to Mr. Naidua��s exertions. Above all, he had instilled in the people of AP a sense of belonging and pride in the State; he made them believe that AP was and is destined to great heights. Unfortunately, his present preoccupation with the subject of capital development in present day Andhra Pradesh,A�to be called Amaravati, in theA�region between Vijayawada and Guntur, appears to be dragging him down.

Farmer dispossession

The expert committee appointed by the Home Ministry under the Andhra Pradesh Reorganisation Act, 2014, and which I had the honour to chair, stated in its terms of reference that fertile, agricultural lands should not be touched as far as possible. Let me explain this. The entire Vijayawada-Guntur-Tenali-Mangalagiri (VGTM) area is regarded as the rice bowl of AP; for that matter, it is, without doubt, one of Indiaa��s important granaries. Now, to take away 30,000 acres of land from the Thullur, Tadepalli and MangalagiriA�mandalsA�which are double crop and triple crop yielding areas and which will result in the dispossession of farmers there for temporary financial gains is an example of short-sighted policy. Some farmers may of course see this as a windfall, spending the monetary compensation on material goods, fancy automobiles and houses. Separately, commercial outlets are dependent on consumer support. In such a situation, it is unlikely that this scale of consumer support will be available in the short run, of five to 10 years, to support the kind of development that one is seeking. The northern part of Thullur is reported to being earmarked to play a key role in the functioning of the capital city. Yet, the fact is that there is no master plan available for the so-called capital city. Nothing is available online a�� for example even on the AP website a�� making it impossible to have an idea of what is being planned where.

Infrastructure development

Another point I wish to highlight is the subject of soil preparation work especially in an area which has a high water table. In a related way, consolidation, road infrastructure and various other items of infrastructure will take a long time to develop and build, even assuming that some land is made available. In the 100 or more new towns India built since Independence, and this includes Chandigarh, Bhubaneshwar, Gandhi Nagar and the a�?steel townsa�� of Bokaro, Durgapur and Rourkela, it took nearly seven to eight years to have the basic infrastructure in place and this was just for the setting up of one or two major industries and entrepreneurial needs! Therefore, the claim that in AP, all these can be done within a span of five years is a gross exaggeration.

The expert committee had pointed out repeatedly that the most serious challenge before AP is to create more than three lakh jobs a year and with significantly higher productivity. These jobs do not seem to be in sight. Towns which have been battered by the recent cyclone need to be rebuilt. Important facilities such as the High Court, and as suggested by the expert committee, have to be located there. These will give some boost to AP.

It is welcome that in Chittoor and Tirupati, medical and some educational facilities are beginning to be set up, mainly with the help of private sector enterprise. But we should not forget that Chittoor and Tirupati draw their strengths from being near the border with Tamil Nadu rather than Hyderabad. Also, in all the talk about Tirupati and Chittoor having the potential to be major educational and health centres, there has been no mention of the potential of Rayalaseema. This is unfortunate. Also, when talk around the subject of the capital appears to recognise a shift of financial capital as well to the VGTM area, one can be quite certain that protests will erupt. The committee has repeatedly said that the most important challenge facing Mr. Naidu, and which he should resolve with his political acumen as soon as possible, is the need for him to look at balanced development as the Chief Minister of Andhra Pradesh and not just of the VGTM area.

The Andhra Pradesh Reorganisation Act, 2014 gave both AP and Telangana a time frame of 10 years to share Hyderabad as a common capital. The committee made a number of recommendations on how this time could be utilised. I am not holding an alibi for the committee; committees have been set up in the country before; some of their recommendations have been accepted while some have been rejected. So, it does not matter whether the recommendations of this committee are accepted or not; what matters is the future of Andhra. There is still time for Mr. Naidu to retrace his steps.

Land pooling

The Act gives ample time for Mr. Naidu to concentrate on the larger issues that confront AP rather than be bogged down by the issue of land for the capital. The companies based inA�Singapore and which are working on the master plan for the new capitalA�are reported to be seeking 3,000 acres outside the capital territory but inside the VGTM area.

Singapore-based entrepreneurs are said to be holding or trying to get hold of significant land parcels in several parts including China. That may well be their policy, but in this case, in AP, the point I wish to make is that whatever goes to Singaporea��s land quota comes from agricultural land parcels. Apart from those directly affected by the capital project, there are millions of households that have no direct and indirect independent agricultural land or income in this area. Given the volatilities in the global economy, it is practically impossible to guarantee the security and the well-being of these families. Funding for the construction of the State capital and its maintenance will have to be mobilised through international financing; the Central government has already indicated the limitations of what it can extend to AP towards this.

It is reported that land holders who account for an area of about 32,000 acres have agreed to surrender their land and accept land pooling. At the same time, there are also reports of growing resistance to the plan in some areas alongside the right bank of the Krishna River. What AP is trying to do is very different to land pooling attempted elsewhere in the country and with varying success. It should be recognised that the success of the Gujarat land pooling plan, which is often mentioned in this context, took place in dense urban areas where the negotiations had a touch of realism. Plans were published repeatedly in a bid to seek consent and it was clear what the authorities intended and what the land holders would be getting.

Infrastructure promotion

AP will become a better-knit geographic and economic entity if Mr. Naidu spends the next few years concentrating on some of the very important projects including those in which the Central Governmenta��s support has been assured such as the coastal corridor, a gas pipeline and its transmission to Rayalaseema, the Nadikudi-Kalahasti railway line, and development of some of the railway lines east to west. This will also build up the political strength of Mr. Naidu across the State.

Every political capital requires political support. But in this case, the fact is that that kind of political support is not available for the capital city project in the State as a whole. AP has a history of being guided for years with the help of a number of able and experienced administrative officers. If only Mr. Naidu can utilise their talent to reorganise some of the priorities before the State at least for the next few years! The point is not about some landmark capital city which may come about later. What is important right now is the nearly suicidal move to mortgage APa��s political energy and financial resources to this capital project.

(K.C. Sivaramakrishnan, Chairman of the Centre for Policy Research, was chairman of the Government of India appointed a�?Expert Committee on AP capitala��.)


2 Responses

  1. B.V.Rama Kumar says:

    Very nice and in depth analysis by Sri. Undavalli Arun Kumar. The shabby way Amaravathi is selected as A.P capital for selfish motive just to benefit a section of people at the cost of majority of people is highly objectionable. The scale of the city by pooling Agricultural land to the tune of 32000 acres is a criminal waste of public resources. The present state of A.P with 13 districts and about 5.0 crores population does not require a capital with 32000 acres. With all this hype and proposed cosmetic touches of Colorful Amaravathi dreams , i am sure no out side investments is possible in the state of A.P because of the group and caste politics prevailing there. The politics taking an ugly turn with Reddy and Kamma politics already , now to add fuel to the fury , the Kapu politics and coming into lime light. God only can save A.P. in future.

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