Andhra Pradesh asks World Bank for Rs 6,600 crore loan to build Amaravati

Hyderabad: The AP government has approached the World Bank for a loan of Rs 6,600 crore for construction of the new capital city of Amaravati. A senior official in the Finance department confirmed this, adding that preliminary discussions showed that the World Bank had, in principle, acceded to the request.

The state government has focused on national and international financial agencies for loans as its hopes of getting large funds from the Centre have dimmed. The Centre has accepted the state government’s request for World Bank assistance, having recently sent it a No Objection letter regarding this.

The senior official spoken to said that HUDCO too had agreed to finance the capital’s construction and that at the recent Partnership summit held in January 2016 at Visakhapatnam, the Capital Region Development Authority and HUDCO had signed a Memorandum of Understanding to this effect.

He said that HUDCO had agreed to the state government’s proposals, seeking a loan to the tune of Rs 7,500 crore, and would raise the funds in the first phase.
The state government has requested the Centre to sanction Rs 4,000 crore per year for the construction of Amaravati. But the centre has so far sanctioned only about Rs 1,850 crore of which the state government has already spent Rs 850 crore on capital-related projects.