Dismissing the row over Amaravati bonds issued recently by the state government, Minister for Municipal Administration, P. Narayana, said the Amaravati bonds 2018 had received a good response and there is no truth in allegations that the bonds had been floated with high interest rates.

Replying to a short-notice question in the AP Assembly on Monday, the minister said the Amaravati bonds were oversubscribed within one hour and fetched Rs 2,000 crore. He said the bonds were issued for Rs 1,300 crore and the Government had decided to retain Rs 700 crore additional subscription by exercising the green-shoe option at an interest rate of 10.32 per cent. He said a fee of 0.85 per cent was paid to the agency for floating the bonds, while several other states had paid one to two per cent.

The minister said Amaravati would be developed at an estimated cost of Rs 48,000 crore. The state government prepared the DPR for capital development and sent it to the Centre, which had released Rs 1,500 crore so far. He said utilisation certificates had been submitted to the Centre and NITI Aayog officials had inspected the ongoing works in Amaravati and accepted that UCs were issued for Rs 1,632 crore. The NITI Aayog had also recommended release of Rs 662 crore, which the Centre had not released so far.

The Minister said tenders were called for capital development works to the tune of Rs 26,000 crore and works were going on. He said several banks had come forward to extend financial assistance of Rs 10,000 crore and the state government would have to deposit 20 per cent of the share.

Referring to the rate of interest on Amaravati bonds, the minister said Amaravati bonds had got a rating of A+ and the interest rate was fixed at 10.32 per cent in line with the rating.

He said TIDCO of Orissa had mobilised Rs 50 crore at 10.4 per cent, Gujarat State Petroleum Rs 1,000 crore at 10.45 per cent, Rajastan Vidyut Yojana Nigam Ltd Rs 323 crore at 10.25 per cent interest, Tamil Nadu Generation Corporation Rs 633 crore at 10.5 interest rate and UP Infra had mobilised Rs 5,400 crore at 10.15 per cent interest rate.

He said the Centre was also encouraging the states to float bonds for development of infrastructure and providing Rs 13 crore as subsidy for every Rs 100 crore. Therefore, "the hue and cry being raised over the bonds is quite uncalled for and motivated."

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