Amaravati, Oct 18 — The World Bank, in collaboration with the Asian Development Bank (ADB), has committed to providing $1.6 billion (approximately ₹13,600 crore) for the development of Phase-I of the Amaravati capital city project. A senior official from the Andhra Pradesh government announced that the funding will commence in January 2025.
The total cost for Phase-I development is estimated at ₹15,000 crore, with the Central government covering the remaining ₹1,400 crore. The funds from both the World Bank and ADB, each contributing $800 million (around ₹6,800 crore), are expected to be utilized within five years.
According to the official, the International Bank for Reconstruction and Development (IBRD), part of the World Bank, will provide loans and guarantees to support the project. The repayment of these loans will be managed by the Central government.
“The project is being funded jointly by the World Bank and ADB. We anticipate the funds will begin to be released by January 30, 2025, although it could happen even sooner. It’s crucial that the amount is fully utilized within five years; otherwise, it will lapse,” the official, who requested anonymity, told PTI.
The bureaucrat noted that future funding for Phase-II will depend on the timely completion of Phase-I, and the World Bank may consider further support for subsequent phases.
Andhra Pradesh Chief Minister N. Chandrababu Naidu recently stated that the World Bank has approved ₹15,000 crore for Amaravati’s Phase-I development, with construction expected to begin in December.
The Land Pooling System (LPS) initiated during Naidu’s previous term from 2014 to 2019 successfully pooled 34,390 acres of farmland in exchange for serviced residential and commercial plots, among other benefits, for the development of Amaravati.
Despite the initial progress, the project was sidelined by the previous YSR Congress government, which proposed a controversial three-capital concept that did not resonate with the public. However, Naidu’s return to power has reignited the capital city project, supported by the Central government’s commitment to facilitate loans from multilateral agencies.
According to a World Bank document, the Department of Economic Affairs at the Centre will act as the borrower, while the Andhra Pradesh Capital Regional Development Authority will serve as the implementing agency. The support from the World Bank and ADB aims not only to bridge financial gaps in the early development stages of Amaravati Capital City (ACC) but also to provide global expertise and technical assistance in urban planning, municipal governance, finance, and infrastructure design.
The World Bank was initially involved in the ACC project back in 2016, but the partnership did not materialize at that time. The renewed engagement is based on insights gained from previous experiences and the current ground situation regarding ACC development, the document further elaborated.
