The Andhra Pradesh State’s Capital Region Development Authority (CRDA) officials are “working on the proposal,” according to sources. At this point, realizing that the chances of securing assistance from the Center are remote, the government is examining the possibility of issuing bonds worth ₹42,000 crore for the construction of its capital city, Amaravati.
Recently, at a review meeting, CRDA authorities placed the idea before Chief Minister N. Chandrababu Naidu. Responding positively, Mr. Naidu asked them to revert with the details, CRDA sources say.
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The bonds may carry rate of interest and a committee is working on it. CRDA officials said, the Reserve Bank of India’s savings bond carries an interest of 7.75%, whereas small saving schemes such as the National Savings Certificate offer 7.6%. It will be easier to attract investors if the rate of interest is fixed at 8%.
A senior officer said that “The Chief Minister suggested that special bonds be issued for overseas Telugus, or Non Resident Telugus in official jargon, as they are keen on being a part of capital construction.”
The Centre has released ₹1,000 crore for projects in Vijayawada and Guntur, and ₹1,500 crore for the construction of Amaravati that to in last four years. The State’s estimate for its capital city is about ₹52,000 crore.
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