In a major development, the World Bank has ‘dropped’ the $700-million Andhra Pradesh Amaravati Sustainable Infrastructure and Institutional Development Project that seeks to develop the greenfield capital of Andhra Pradesh.

The Working Group on International Financial Institutions has welcomed the World Bank decision to drop the project after taking cognizance of protests.

The World Bank has committed $300 million out of the total project cost of $700 million. The project, a vision of former Chief Minister, N Chandrababu Naidu, to build a world class capital, is being implemented by the Andhra Pradesh Capital Region Development Authority (APCRDA), which has the mandate to develop the Amaravati capital region. The project, approved last year, was aimed at providing urban infrastructure in designated locations in the capital and supporting the initial development of its institutional and governance structure.

Incidentally, the new Government led by Chief Minister, YS Jaganmohan Reddy, has opposed the new capital from day one of its coming to power.

The project had five main components, covering basic urban and pro-poor infrastructure, roads to integrate various habitations, upgrading water supply, sewage and drainage in some key villages that are being integrated.

The project also sought to provide sustainability and climate resilience in the capital by supporting its integration with the natural surroundings, riverfront, and greenery.

Though the Bank has not indicated any reason or reasons for dropping the project, the project report hinted at several environmental risks involved in the implementation. The project report quoted an estimated 21,374 families would be impacted by ‘land assembly processes’ in the capital region.

The Bank arrived at this decision after a series of representations it received from many people’s movements and civil society organisations over the past years, and a complaint to its accountability mechanism, Inspection Panel, by the affected communities.

Patkar hails decision

“We are happy that the World Bank took cognisance of the gross violations involved in the Amaravati Capital City project, threatening the livelihood of people and the fragile environment,” Medha Patkar, a leader of Narmada Bachao Andolan and National Alliance of People’s Movements, said.