VIJAYAWADA: In a significant relief to Andhra Pradesh, the Government of India has decided that loans provided for the State’s Capital City development will not be factored into its borrowing ceiling. This was stated by Union Minister of State for Finance Pankaj Chaudhary in writing, in reply to a question raised by YSRCP MP Maddila Gurumoorthy in the Lok Sabha.
The Union Minister explained that the Centre has already allocated Rs 2,500 crore as Special Assistance (Grants) for the development of essential infrastructure in Amaravati.
Additionally, it has secured multilateral loan approvals of approximately Rs 6,700 crore each from the World Bank (effective from January 22, 2025) and the Asian Development Bank (effective from February 10, 2025) for the Amaravati Integrated Urban Development Programme, and the Inclusive and Sustainable Capital City Development Programme respectively. However, no disbursements have been made yet.
These funds will support development of critical infrastructure, including the State Assembly, Secretariat, and Raj Bhavan within the Amaravati Government Complex. The Centre has also decided to provide counterpart funding of not more than 10% of the total current project cost (i.e. maximum Rs 1,500 crore) as Special Assistance (Grant) to Andhra Pradesh, the Union Minister said.
Further, Pankaj Chaudhary informed that the utilisation of funds provided will be governed by the prescribed guidelines/conditions of the loans, and monitoring mechanism laid down in the loans approved.