Andhra Pradesh gains statutory clarity on Amaravati as capital after long wait

Hyderabad: Nearly 12 years after the bifurcation of Andhra Pradesh and amidst at least 45 per cent of overall escalation in the cost the state finally has statutory clarity on its capital. The Lok Sabha on Wednesday passed the Andhra Pradesh Reorganisation Amendment Bill, formally recognising Amaravati as the state capital. Passage in the Rajya Sabha and an official gazette notification are now a formality.

The bill brings to a close one of independent India's most protracted and politically bruising capital disputes, a saga marked by competing visions, bitter one upmanship, broken promises to farmers, and a staggering financial toll on an already resource-strained state.

While other newly formed states like Jharkhand, Chhattisgarh, and Uttarakhand established working capitals within years, Andhra Pradesh had to wait for 12 years to even gain statutory clarity about its capital.

When Telangana was carved out in 2014, Andhra Pradesh lost Hyderabad, its administrative nerve centre, to the new state. The then Chief Minister N Chandrababu Naidu responded with a blueprint with a Singapore-inspired greenfield capital called Amaravati, sprawling across 217 square kilometres along the Krishna River, projected to cost Rs 1.09 lakh crore.

Over 30,000 farmers from 29 villages surrendered approximately 34,000 acres of fertile land under a land pooling scheme, trusting government assurances of fair compensation and a prosperous future. In exchange, they were promised between 800 and 1,200 square yards of residential plots and up to 450 square yards of commercial land in fully developed layouts.

Naidu's track record lent the project credibility. His earlier transformation of Hyderabad's Cyberabad into a premier IT hub had earned him the reputation of a "CEO Chief Minister," and Amaravati briefly captured national imagination.

That momentum collapsed in 2019 when YS Jagan Mohan Reddy's YSRCP swept to power. Jagan abandoned Amaravati in favour of a controversial decentralised model of three capitals, with executive functions in Visakhapatnam, the judiciary in Kurnool, and the legislature in Amaravati. Estimated to cost Rs 15,000 crore, the proposal was widely criticised as politically motivated and seen as a deliberate effort to diminish Amaravati and, by extension, Naidu's legacy.

The fallout was immediate as the farmers launched a protest that ran uninterrupted for nearly six years. Women marched, families held vigils, and elderly landowners spent sleepless nights fearing their sacrifices had been rendered worthless.

The Supreme Court ultimately mandated Amaravati as the sole capital, but years of litigation and political paralysis had already exacted an enormous cost in stalled construction, administrative drift, and deepening public cynicism.

Andhra Pradesh's predicament worsened further when Hyderabad's joint-capital status formally ended in June 2024. Andhra was the only Indian state with a 'transit' capital being run in temporary buildings.

The tide began to turn when the TDP-led NDA alliance returned to power following the 2024 Assembly elections. In a symbolic moment, farmers from the Amaravati region visited Jagan's residence on election results day not in protest, but to thank him for paving way for development of Amaravati by losing the 2024 polls. They carried mangoes, bananas, and sweets to give him.

Prime Minister Narendra Modi subsequently in May last year relaunched the project, laying the foundation for 74 infrastructure works worth Rs 49,000 crore, encompassing the Assembly, Secretariat, High Court, and residential quarters for officials and legislators.

Delay in taking up works for the Amaravati capital city has also resulted in an approximate 45 per cent rise in construction costs, according to Municipal Administration and Urban Development (MAUD) Minister P Narayana who oversees Amaravati development. In December 2024, he said between 2014 and 2019, tenders worth Rs 41,000 crore were issued, with works worth Rs 5,000 crore being completed. He added continuing the works as per plan would have prevented losses to the State government.

While the cost to construct roads has increased by 25-28 per cent, it has surged by 35-55 per cent for buildings. The price of gravel is expected to escalate by 6 per cent. Schedule of rates has increased by 29 per cent, GST has increased by 6 per cent, and other damages have resulted in a 1.6 per cent surge in costs, he added.

The Union government has facilitated Rs 15,000 crore in loans from the World Bank and Asian Development Bank, with an additional Rs 15,000 crore expected from HUDCO and Germany's KfW development bank. The Capital Region Development Authority has finalised tenders worth Rs 31,000 crore, with residential complexes currently between 66 and 80 percent complete. Wednesday's parliamentary vote transforms what was a judicial directive into a legislative mandate giving Amaravati a legal foundation.