Finance Minister Nirmala Sitharaman announced ₹15,000 crore financial support for Andhra Pradesh to build its capital city, Amaravati, and boost other development activities in the state. In her budget speech on Tuesday, FM Sitharaman said, “Our government has made concerted efforts to fulfil the commitments in the Andhra Pradesh Reorganisation Act.”
"Recognising the state's need for a capital, we have facilitated special financial support through multilateral development agencies," she added.
Sitharaman said that in the current financial year, ₹15,000 crore will be arranged with additional amounts in future years. "Our government is fully committed to financing the early completion of the Polavaram Irrigation Project – which is the lifeline of Andhra Pradesh and its farmers," she added.
"This will facilitate our country's food security as well," the finance minister said while announcing the Union Budget for FY 2024-25.
Under the Andhra Pradesh Reorganisation Act, for promoting industrial development, funds will be provided for essential infrastructure, "such as water, power, railways and roads…on the Vishakhapatnam-Chennai industrial corridor, and on the…Hyderabad-Bangalore industrial corridor," Sitharaman announced.
She also said that additional funds will be provided towards capital investment for economic growth. The minister also announced backward region grant for three districts of the state.
Sitharaman announced the allocation for the development of Andhra Pradesh months after the Telugu Desam Party (TDP), which rules Andhra, joined hands with the Bharatiya Janata Party (BJP) to become part of the National Democratic Alliance (NDA). The NDA formed the government at the Centre in June. The BJP formed the coalition government with support from the TDP and Nitish Kumar's JDU.
Political parties from Andhra Pradesh have protested time and again since 2014 demanding special category status for the state. Special category status is a classification of regions or states by the central government to provide special assistance in the form of tax benefits and financial support for development of the region.
After Sitharaman's announcement on Tuesday, the Congress took to X to take a dig at Chandrababu Naidu's TDP for securing “special financial support” rather than the special category status for the state.
“In 2018, Chandrababu Naidu garu quit the NDA because of the non-biological PM’s failure to grant Andhra Pradesh Special Category Status. Six years after the drama, at a time when the Government is reliant on his MPs for support, all he has managed to get is “special financial support” for Amravati,” Congress leader Jairam Ramesh said.
