#AndhraPradesh: World Bank Withdraws $300 Million Assistance to Amaravati Development Project
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New Delhi, July 19: The World Bank has pulled out of the Amaravati Sustainable Infrastructure and Institutional Development Project. The World Bank’s website shows the status of the Amaravati Sustainable Infrastructure and Institutional Development Project as ‘Dropped’.
The Bank has not assigned any reason for dropping out but it seems that it has taken into consideration various complaints from people’s groups about environmental concerns. On the request of previous chief minister N. Chandrababu Naidu, the bank had agreed to loan $300 million for the project. His government had claimed that the World Bank agreed ‘in principle’ to lend $1 billion for the development of Amaravati.
Under the proposed EAP, the World Bank was to lend $300 million, while the Asian Infrastructure and Investment Bank (AIIB) was supposed to lend another $200 million. With the World Bank dropping the loan proposal, CRDA officials are unclear over the fate of the AIIB component. The Chandrababu Naidu government reportedly listed it under the Externally-Aided Projects under the Special Assistance Measures announced by the Narendra Modi government in 2016 so that the repayment burden would be taken on by the Centre.
The ruling YSR Congress Party government claimed that the withdrawal was because of alleged irregularities in the project by the TDP government. The party’s MP Vijayasai Reddy said that the decision to withdraw the loan application was taken since the Indian and Andhra government did not want a foreign agency conducting an inquiry into any alleged irregularities by the previous Naidu government.
Officials who headed the AP Capital Region Development Authority (CRDA) during the previous dispensation even claimed that the World Bank included the project under retro-financing category, which meant that the international lender would reimburse all the amount the government spent on the project.
Several NGOs and environmentalists have been opposing the previous Telugu Desam Party (TDP) governments plans to build the capital by acquiring land from farmers and protested against development very near to the Krishna riverbank.People affected by the development of the capital welcomed the move. Mallela Sheshagiri Rao from the Capital Region Farmers Federation said the the project’s uncertainty hovering above them in respect to our land and livelihood, they had suffered sleepless nights with fear and pain.
The activities have claimed that while many farmers have agreed to pool their lands for the project, NGOs and activists have claimed that a majority of them were coerced or left with no option. Farmers also expressed opposition because very fertile agricultural land was being converted into commercial and residential areas. The land, located in the Krishna basin, produces three crops a year and farmers can choose from 120 varieties. Building on the Krishna’s river bed would also increase the risk of flood.