VIJAYAWADA: At a time when the State government is pulling out all the stops to promote Amaravati as the next major tourist destination, private investors do not appear too enthused about investing in the proposed tourism projects in the city. The case in point: The AP Capital Region Development Authority (CRDA), owing to passive response from bidders, has now given a second call to investors for a Request For Proposal (RFP) for the much-touted Amaravati Marina project.
Even though the APCRDA had invited an RFP for the proposed project in March and held pre-bid meetings with prospective investors, only two firms have submitted their proposals till now.
“Initially, about 15 firms evinced interest in the project, but only two filed bids from across the country. We have decided to give a second call as the number of bids filed was lower than we expected,” a senior official explained.
It may be recalled that the project was proposed to be developed in eight acres in Venkatapalem village of the capital region, as the biggest marina in the country. The estimated cost of the project was `40 crore.
Not just the Amaravati Marina project, even a few other projects proposed under Public Private Partnership (PPP) model, such as the Sports and Recreation Club, which is a part of the Amaravati Central Park, world-class multipurpose sports hub and others, are in a similar situation.
“Without inhabitants [in the capital], there will be no tourists to use the facilities. Therefore, the project cannot be financially sustainable in the short term,” was one fear raised by a prospective investor. Similarly, other bidders sought higher revenue sharing considering that the greenfield city would have challenges from the “densification and populating aspect”.The State government projected that Amaravati would contribute six per cent and 33 per cent of the total domestic and international tourist footfall of Andhra Pradesh in 10 years’ time.
However, prospective investors are apprehensive that the proposed projects may not be financially viable.
However, CRDA officials expressed the confidence that all the PPP projects would take off soon.
“It is a normal practice for the prospective bidders to raise a few red flags. When they have any issue, we will see if it is genuine and make changes to the terms of the project, if required. But, it is not right to generalise and say that projects under PPP will run into issues,” another official from the Capital City Development Project (CCDP) wing of the CRDA explained. The official also cited the examples of the progress of Amaravati Central Park, iconic bridge across River Krishna and other projects, which are also being developed under PPP, to support his argument.
Lukewarm response
Even though the APCRDA had invited an RFP for the proposed project in March and held pre-bid meetings with prospective investors, only two firms have submitted their proposals till now.
Initially, about 15 firms evinced interest in the project, but only two filed bids from across the country. We have decided to give the second call as the number of bids filed was lower than we expected
The State government projected that Amaravati would contribute six per cent and 33 per cent of the total tourist footfall