Budget 2024: Centre to Secure ₹15,000-Crore Support from Global Agencies for Amaravati Development.

The Union Government will facilitate special financial support through multilateral development agencies amounting to ₹15,000 crore for Andhra Pradesh's capital, Amaravati, announced Union Finance Minister Nirmala Sitharaman.

In her Budget 2024-25 speech on Tuesday, Sitharaman stated, "Our government has made concerted efforts to fulfil the commitments in the Andhra Pradesh Reorganisation Act. Recognising the State’s need for a capital, we will facilitate special financial support through multilateral development agencies. In the current financial year, ₹15,000 crore will be arranged, with additional amounts in future years."

Funds will also be provided for essential infrastructure such as water, power, railways, and roads in the Kopparthi node on the Visakhapatnam-Chennai Industrial Corridor and the Orvakal node on the Hyderabad-Bengaluru Industrial Corridor. Additional allocations will be made this year towards capital investment for economic growth, Sitharaman added. Grants for the backward regions of Rayalaseema, Prakasam, and North Coastal Andhra, as stated in the Act, will also be provided.

The NDA’s pre-poll manifesto in the State promised building a new capital at Amaravati, completing the long-pending Polavaram Irrigation project, and a host of freebies under its ‘Super Six’ welfare schemes. Centre’s financial support is crucial for the State Government to fulfil these promises.

In a first-of-its-kind move, the State Government deferred the full Budget for the sake of clarity on State finances. It will be releasing a white paper on the finances in the ongoing Assembly sessions.

According to government data, capital expenditure was reduced by 60% in 2019-24 compared with 2014-19. Departments such as Water Resources and Transport, Roads & Buildings, which undertake substantial capital works, were left ‘critically short of funds’ to carry out any works.

The compound annual growth rate of the State’s Own Tax Revenue slipped from 12.8% to 8.1% during this period, while revenue expenditure increased from 7.8% to 10.5%.

Commenting on the Union Budget allocations for Andhra Pradesh, Jayadev Galla, Chairman of Amara Raja Group, said, "₹15,000 crore support for capital development, commitment to financing and completion of the Polavaram irrigation project, grants for backward districts, and allocation of funds for various social and infrastructure development projects will significantly attract new investments and spur growth. We eagerly await the actual allocations for other projects and fulfillment of commitments made in the AP Reorganisation Act. We look forward to continued support from the Centre as we work to rebuild the State."

HBL