In yet another major development related to Amaravati, the upcoming capital of Andhra Pradesh, the Singapore government on Tuesday said that it had accepted the decision of the YSRCP government to close the Amaravati Capital City Start-Up Area project.
The announcement came a day after the state government, led by Chief Minister Jagan Mohan Reddy, issued a Government Order dated November 11, 2019, making the decision official.
"The closure is based on mutual consent between the Government of AP and the Singapore Consortium (comprising Ascendas Singbridge Pte Ltd (now part of CapitaLand Group) and Sembcorp Development Ltd)," a press release from the Singapore government's Ministry of Trade and Industry stated.
The Singapore Consortium was appointed in 2017 by Chandrababu Naidu government to develop a 6.84 square km 'Start Up Area' in Amaravati. It was aimed at boosting economic activity in the region.
The YSRCP government said that though it had completed all the formalities from its side, no work had taken place on the ground, thereby resulting in the Start Up Area not 'serving its intended purpose'.
The GO issued on November 11, stated that "there is no intended development in the project of despite signing of Concession Agreement and Development Agreement (CADA) and Shareholders Agreement (SHA) on June 7, 2018."
Meanwhile, the press release from the Singapore govt also quoted the country's Minister-in-charge of Trade Relations S Iswaran saying, â€śWe note that the newly elected Government of Andhra Pradesh has decided not to proceed with the Start-Up Area given its other priorities for the state."
"Companies recognise such risks when venturing into any overseas market and factor them into their investment decisions. In this instance, the Singapore Consortium companies have stated that the project has cost them a few million dollars, and that its closure does not impact their investment plans in India," he added.
The Singapore government added that companies remained interested in opportunities in Andhra Pradesh and other Indian states, "because of the size and potential of the market."
"Our economic agencies will continue to help our companies internationalise by exploring opportunities in India and other overseas markets,â€ť Iswaran said.
The latest development comes just days after it was revealed that the previous Telugu Desam Party (TDP) government had failed to issue a gazette notification defining the capital region.
Instead, the party pointed out that the Andhra Pradesh Capital Region Development Authority Bill was passed in the Assembly in December 2014, on the capital.
While the TDP, led by Chandrababu Naidu, had envisioned Amaravati as a sprawling megalopolis, the YSRCP led by Jagan Mohan Reddy has not been so keen.
After the YSRCP stormed into power in May this year, it halted all ongoing construction projects in the capital region, and alleged that Naidu had resorted to insider trading and corruption during the construction of the capital.
While a temporary Secretariat, Assembly and High Court have been built in the capital region, along with seed roads connecting various villages, many construction projects are stuck in limbo.