Hyderabad: The Andhra Pradesh government's Capital Region Development Authority (CRDA) had decided to initiate talks with the Singapore government about developing the seed capital area in Amaravati.
The decision in this regard was taken at the CRDA's first meeting held on Friday with chief minister N Chandrababu Naidu.
As soon as the YSRCP came to power in 2019, the then government had canceled an agreement with the Singapore Consortium, comprising Ascendas Singbridge Pte Ltd, which is now part of CapitaLand Group, and Sembcorp Development Ltd, to develop the seed capital area in Amaravati.
In 2018, the CRDA under the TDP government signed a concession and development agreement (CADA) and a share holding agreement (SHA) with a Singapore consortium to execute the Amaravati Start-up Area Development Project.
The start-up area encompasses a total development land area of 6.84 sq km, slated for development in three phases spanning 20 years. At that time, over 15 companies and institutions from Germany, India, Japan, and Singapore entered into Memoranda of Understanding as partners in the areas of smart buildings, smart energy, smart environments, and smart collaborations.
“The CRDA meeting today decided to initiate talks with the Singapore government about developing the seed capital area, for which the previous YSRCP government had canceled the earlier agreement,” said Andhra's MA and UD minister P Narayana.
Between 2014 and 2019, the previous Naidu government, with the support of the Singaporean government, envisioned a start-up area development project in the core capital region, for which they floated Amaravati Development Partners (ADP).
However, after the YSRCP came into power in 2019, the then finance minister Buggana Rajendranath was deployed by the then chief minister, YS Jagan Mohan Reddy, to initiate talks with the Singapore government for a mutual understanding for the voluntary liquidation of the startup project.
Rajendranath had also visited Singapore once and held several rounds of talks with the relevant heads of government there. Finally, the Singaporean government, too, agreed to withdraw from the project voluntarily with some mutually agreed terms.
Singapore Amaravati Investment Holdings (SAIH) and Amaravati Development Corporation Ltd. (ADCL) were shareholders in the ADP.
SAIH was a wholly-owned joint venture company of Ascendas-Singbridge Andhra Investment Holdings and Sembcorp Development India.
On November 12, 2019, following the state government's announcement to discontinue the start-up area development project, the Singaporean government also formally announced the project's closure.
Singapore’s then trade minister, S. Iswaran, who now faces corruption charges in his country, said that the project had cost the Singaporean companies a few million dollars and that the closure would not impact their investment plans in India. He said Singapore still remains interested in opportunities in Andhra Pradesh.
S Iswaran, in a statement on November 12, 2019, said, “The Singapore Consortium was appointed by the Government of Andhra Pradesh in 2017 to help master develop the 6.84 km2 start-up area of its new capital city, Amaravati. We 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. Singapore companies remain 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.”
In another statement, Singapore Amaravati Investment Holdings (SAIH), which was formed to take up the start-up area development project, said that following the change in the scenario for the development of Amaravati Capital City, it is no longer feasible to develop the Amaravati Capital City Start-up Area as originally planned.