In a new step towards building Amaravati, the capital of Andhra Pradesh, senior officials of the AP Capital Region Development Authority (APCRDA) on Tuesday held negotiations with representatives of the World Bank and of the Asian Development Bank in New Delhi to sign an agreement to obtain a loan of 1.786 billion US dollars ( ₹15,000 crore) for the project, people familiar with the matter said on Tuesday.

The project, ‘Amaravati Capital Inclusive and Sustainable Development Program’, was approved by the World Bank after a series of negotiations and the latter communicated it to the state government through the Ministry of Economic Affairs September 11.

While the World Bank and the Asian Development Bank will each provide financial support of US$800 million (a total of US$1.6 billion or ₹13,500 crore), the remaining amount will be covered by the state government with the support of the central government.

“Final negotiations are underway and the agreement will be signed in New Delhi by Wednesday,” said an official close to the matter.

The state government on Sunday issued an order designating APCRDA as the implementing agency on behalf of the government and signed the project agreement with the lending agencies. The APCRDA Commissioner will take all necessary steps and actions to obtain financial assistance from these lending agencies for the development of the capital Amaravati, the order said.

The loan obtained from the World Bank and ADB will be used for various works, including the construction of main roads and utility conduits for essential services, storm water drainage and flood mitigation through the development of streams, retention reservoirs and a flood defense system, provision of roads, utilities, green spaces in Land Pooling System (LPS) areas, provision of a flood defense system 24-hour drinking water supply 24, creation of sewerage system including treatment plants, construction of key public buildings using green standards, institutional strengthening and capacity building. finance through innovative financing methods.

The State Government has directed the Commissioner of APCRDA to create a separate budgetary item along with allocation and periodic transfer of funds from the lending agencies to the current account of APCRDA in accordance with the framework of the scheme.

Interestingly, the state government, for the first time after five years, has allocated ₹3,445.33 crore for capital Amaravati in this year’s annual budget presented in the state Assembly on Monday.

While ₹3,000 crores will be spent on creating infrastructure in the capital, ₹400 crore was allocated for payment of rent to farmers who had handed over their land to the government under the land pooling scheme for Amaravati.

“Of the remaining amount, ₹32 crores will be spent under the Amaravati Smart Cities program and ₹13.33 crore for provision of equipment in the High Court building,” the budget document said.

Last month, the central government’s Housing and Urban Development Corporation Ltd (HUDCO) also agreed to provide a loan of ₹11,000 crore for the construction of the capital.

A delegation from HUDCO, led by its chairman and managing director Sanjay Kulshreshtha, met Chief Minister N Chandrababu Naidu on October 25 to discuss the loan proposal. ₹11,000 crore for the construction of the capital Amaravati.

“The state government is considering mobilizing another ₹23,000 crore in other forms, including loans and bonds, in addition to grants from the central government over a period of time to complete the works at the capital Amaravati over the next three years,” the official quoted here added. -above.