AP govt forms panel to study Swiss model for Amaravati's development

Vijayawada: The Andhra Pradesh government on Friday constituted a high powered committee to study the controversial Swiss Challenge model for the development of state capital Amaravati.

With top bureaucrats of the state opposing the Swiss Challenge model and also given the "objections" reportedly raised by the Centre, the Chandrababu Naidu government constituted the 10-member committee to "identify, address and resolve the issues relating to the proposal with the original project proponent".

The Committee will be headed by state Finance Minister Yanamala Ramakrishnudu.

The state government has already signed a memorandum of understanding (MoU) with a Singapore consortium of Ascendas-Singbridge and Sembcorp Development Ltd for development of the 'core capital area' in 8 sq km (about 2,000 acres).

Subsequently the core capital area has been extended to 16 sq km and now to 20 sq km (about 5,000 acres), giving the Singapore consortium rights over a freeholding area of a few hundred acres.

The consortium is expected to create necessary infrastructure, as suggested by the state government, and lease it out at its own rates.

The Centre reportedly raised an objection over granting sweeping rights to the Singapore consortium, pushing the state government plans into jeopardy.

Under the Swiss Challenge, a developer will be asked to present a bid. Then, other prospective developers would be asked to present counter bids. If the latter is lower, the first bidder will be asked to submit another bid again.

If the first bidder comes up with lower bid, then he gets the right or if he fails, the one with lower bid gets the project.

Now, in an apparent bid to stave off the controversy, the state government has decided to constitute a high-powered committee to "identify, address and resolve the issues relating to the proposal with the original project proponent to make the proposed Swiss Challenge method compliant before calling for counter proposals."

The Committee, in an order issued by Municipal Administration and Urban Development Department Principal Secretary Ajay Jain, has been asked to assess if the "scale and scope" of the project is in line with the requirements of the state.

The Committee is also required to examine whether the "sharing of risks" as proposed in the Concession Agreement is in conformity with the risk sharing frame-work as adopted or proposed by the government for similar projects, if any.

Also, if the project is in conformity with long-term objectives of the government.

The Committee has been asked to conduct discussions with the Singapore consortium and submit its recommendations within 15 days.

Besides the Finance Minister, Municipal Administration Minister P Narayana, Principal Finance Secretary P V Ramesh, Principal Secretary (Capital Region Development Authority) Ajay Jain, Capital City Development and Management Corporation CMD Lakshmi Parthasarathy, State Planning Council vice chairman Kutumba Rao and others will be members of the Committee, while CRDA Commissioner N Srikanth will be its member convenor.