Amaravati Sold Out to Singapore: YSRCP

Hyderabad: Expressing concerns over lapses in capital city development project, Public Accounts Committee chairperson Buggana Rajendranath Reddy has slammed AP Chief Minister N Chandrababu Naidu for handing over Amaravati to Singapore consortium. He said Naidu has surrendered everything to Singapore consortium, while raising a question who’s responsible for tax paid, public money, state debt, state pride and honor?

Speaking to the media here on Saturday, Reddy explained to the media about mind-boggling facts in Capital City development project. He said in the name of Swiss Challenge, CM Naidu has resorted to all types of gimmicks to hand over the capital city to Singapore consortium .

Naidu has offered 58 percent stake in Amaravati Development project to the Singapore consortium and rest of 42 percent will be held by the AP government. The projects cost is Rs3,000 crore. Singapore consortium will contribute Rs300 crore and AP government would invest Rs200, while Rs500 crore would be mobilized via debt route. Later, Rs2,000 crore will be raised by booking profit from selling plots after the development. Amaravati capital city project’s board will have six directors in total four directors from Singapore consortium and two from AP government. AP government already lost control as it has below 50 percent stake.

Last June, AP Cabinet approved the controversial Swiss Challenge model for awarding the capital city development project to Singapore consortium of Ascendas-Singbridge and Sembcorp Development Limited, which in 2015 submitted a proposal under Swiss Challenge model. Singapore government holds 74.5 per cent equity in the consortium. AP government has floated a special purpose vehicle (SPV) called Amaravati Development Company (ADC). Singapore consortium and the ADC will together develop the Amaravati capital city.

Reddy further said: “Naidu has offered 58 percent stake in Amaravati Development project to the Singapore consortium and rest of 42 percent will be held by the AP government. The projects cost is Rs3,000 crore. Singapore consortium will contribute Rs300 crore and AP government would invest Rs200, while Rs500 crore would be mobilized via debt route. Later, Rs2,000 crore will be raised by booking profit from selling plots after the development. Amaravati capital city project’s board will have six directors in total four directors from Singapore consortium and two from AP government. AP government already lost control as it has below 50 percent stake. Now, with two directors and entrusting all types of rights over the development project, what will the AP government do? In addition to this, AP government is giving irrevocable power of attorney to Singapore consortium. Which means after awarding nothing can be retracted.”

All these what happened pertaining to Amaravati project are not qualified under Swiss Challenge model also. This is not a Swiss Challenge model. In the name Swiss Challenge, CM is resorting to all types of malpractices. It’s only a ‘Chandranna Challenge.’

AP government will hand over 1,691 acres of land the Singapore consortium in three phases as the seed capital for the capital city development. Naidu has offered first 50 acres at meagre price and 200 acres at Rs 4 crore per acre. This will be developed as first phase of the project.
Reddy further questioned a provision that enables Singapore consortium to seek more land in addition to the present allocated 1,690 acres.

He also slammed Naidu for agreeing on terms over a management company, which will monitor the development project and charge 5.5 percent as consultant fee. It’s also entitled to get 1.5 month lease amount if commercial space is let out.
Reddy criticized another provision in the agreement stipulating AP government developing the surrounding area of Amaravati capital city and this would cost Rs5,500 crore. AP government has to provide piped gas and other amenities as well.

“Why should AP government bear this cost also,” questions Reddy, while expressing concern over rights of Singapore consortium to fix a benchmark price for the commercial space. “If AP government sells below the benchmark price, AP government has to bridge the gap of the difference amount.”

Any case of disturbance in the development of the project, without political reason, the AP government’s responsibility to safe guard the capital of Singapore consortium. If project is disrupted owing to the government’s fault, then AP should return the capital with 20 percent interest. If it’s disrupted due to political reason, AP government should return 1.5 times of capital with 16 percent interest. Are there any such type of conditions in the world?

“We’re questioning Naidu for not awarding the projects to Indian companies. Naidu has bad opinion about Indians. He said If Indians develop projects it’ll be slum. This is what the opinion of our honorable CM about Indians.”

According to Indian Contract Act-1872, only loss as on the date of determination can be paid in case of any cancellation happens. What’s the motto of Naidu behind accepting all these conditions. Capital, debts, responsibility, land everything from AP, but profits go to Singapore consortium. In other words, literally Naidu has handed over Amaravati to Singapore.”

Pointing out the duration of the project, Reddy questioned “In 2014 December, first MoU was signed and nothing happened so far after two years. Why it takes 20 years time for developing the project. Develop the land and construct buildings. That’s it. It’s nothing but plots business.
Responding to a question on Aditya construction company, Reddy said the company had sought more information, but CM gave nothing but one month time to participate in the bidding process and project report. how can any company participate in such manner.

“We’re questioning Naidu for not awarding the projects to Indian companies. Naidu has bad opinion about Indians. He said If Indians develop projects it’ll be slum. This is what the opinion of our honorable CM about Indians.”

Unsolicited Swiss Challenge, but CM solicited it as all these what happened pertaining to Amaravati project are not qualified under Swiss Challenge model also. This is not a Swiss Challenge model. In the name Swiss Challenge, CM is resorting to all types of malpractices. It’s only a Chandranna Challenge,” said Reddy.
YSRCP has advised CM to float global tenders by providing 10 percent margin. “Why 58 percent to Singapore,” questions Reddy.