#1PRESENTATION ON STATUS REPORT - UNION'S COMMITMENTS TO ANDHRA PRADESH FDR FOUNDATION FOR DEMOCRATIC REFORMS Date: 7 January 2019 Srikakulam Vizianagaram Visakhapatnam East Godavar West Godavari Guntur Krishna Prakasam Kurnool Nellore Anantapur Kadapa Chittoor by Independent Group of Experts (IGE)#2Towards Cooperative Federalism Harmonious reconciliation of conflicting interests Fair and reasonable solution Study of issues of federalism 2#3Unique Circumstances of Andhra Pradesh division State divided by a law of Parliament without a resolution of the State Legislature TELANGANA • HYDERABAD ANDHRA PRADESH The minority region comprising the capital and a higher per capita income demanded division Due to loss of Hyderabad to Telangana, the Successor State of Andhra Pradesh lost the advantages of economic growth, job creation and revenue mobilization Over- Centralization and skewed development led to loss of education, tertiary healthcare and all specialized administrative and training facilities to Telangana Loss to the Successor State of Andhra due to the anomalous provisions in the Andhra Pradesh Reorganisation Act (APRA), 2014 regarding refund of taxes and recovery of arrears of taxes and duties 3#4Consequent Situation Lowest contribution of services and highest contribution of agriculture Persistent revenue deficit Lowest per capita among the southern states Rs.in Crore 2016-17 (AE) SI.No INDUSTRY Andhra Telangana Pradesh Tamil Karnataka All-India 1 AGRICULTURE 203860 % CONTRIBUTION 31.77 92162 15.34 Nadu 137080 11.39 (Lakh Cr.) 117132 11.68 23.82 17.32 2 INDUSTRY 142651 132742 381732 237518 39.90 % CONTRIBUTION 22.23 22.10 31.72 23.68 29.02 3 SERVICES 295186 375762 684444 648256 73.79 % CONTRIBUTION 46.00 GVA 641697 62.56 600666 GSDP/GDP 699307 646265 56.88 1203256 1298511 64.64 53.66 1002906 137.51 1132690 151.84 200000 180000 160000 140000 120000 100000 Andhra Pradesh Telangana Tamilnadu 80000 60000 Karnataka Kerala 40000 20000 0 2013-14 2014-15 2015-16 2016-17 2017-18#5Commitments of Government of India भारत सत्यमेव जयते ant राजपत्र The Gazette of India vlk/kkj.k EXTRAORDINARY Hkkx II-[k.M 1 PART II Section 1 izkf/kdkj ls izdkfkr PUBLISHED BY AUTHORITY The Andhra Pradesh Reorganisation Act, 2014 made specific provisions to address the concerns and needs of the people of the Residual State of Andhra Pradesh The Prime Minister made a solemn statement on 20 February 2014 making explicit commitments to address the concerns of all regions of the erstwhile state of Andhra Pradesh, particularly of Seemandhra (Successor State of Andhra Pradesh) CENTRE TO FOOT PRIME MINISTER MANMOHAN SINGH ANNOUNCES SIX-POINT PACKAGE FOR SEEMANDHRA IN A BID TO ENSURE Seemandhra Bill JUSTICE & PROSPERITY TO THE REGION FIRST, For purposes of Central assistance, Special Category Status will be extended to the successor state of Andhra Pradesh comprising 13 districts, including the four districts of Rayalaseema and the three districts of north coastal Andhra for a period of five years. This will put the State's finances on a firmer footing. SECOND, Spl THIRD, The Bill stipulates that Centre shall development take appropriate fiscal measures, including package for offer of tax incentives to the successor backward states. These incentives will be along the regions of lines extended to some other states. mandhra, hes of RFTH, If further FOURTH, Resource gapi AP in the very first the successor state will be compens regular b INDIAN Fri, 21 February 2014 EXPRESS www.readwhere.com/read/c/3758129 5#6Summary of Issues Resource Gap for the year 2014-15 Loss incurred on account of anomalies of law (Section 50 of Andhra Pradesh Reorganisation Act, 2014) in respect of arrears of taxation The amount estimated to be due from the Union in lieu of 90% Union share in Centrally Sponsored Schemes Assistance required for completing Polavaram Project Assistance for development of backward regions based on Bundelkhand pattern Establishment of Duggirajapatnam and/or alternative port Establishment of eleven nationally important institutions in Andhra Pradesh Projects to improve infrastructure, connectivity and investments in Andhra Pradesh Assistance to develop government infrastructure and the Capital City region Tax and other incentives for investment in Andhra Pradesh 6#7(1) Resource Gap for the year 2014-15 Commitments of Government of India: Para 6 of the Prime Minister's statement in Parliament on 20 February 2014 "Sixth, the resource gap that may arise in the successor state of Andhra Pradesh in the very first year, especially during the period between the appointed day and the acceptance of the 14th Finance Commission recommendations by the Government of India, will be compensated in the Regular Union Budget for 2014-15." Section 46 (2) of the AP Reorganisation Act, 2014 "(2) Notwithstanding anything in sub-section (1), the Central Government may, having regard to the resources available to the successor State of Andhra Pradesh, make appropriate grants and also ensure that adequate benefits and incentives in the form of special development package are given to the backward areas of that State." What is the amount Andhra Pradesh is entitled to as per the commitments ? As estimated by CAG, the total revenue deficit comes to Rs. 16,078.76 Crore GOI has funded only Rs. 3,979.50 Crore and the total commitment is Rs. 4,117.89 Crore GOI disallowed many expenditures on the ground that they are not standardized, or are not ongoing schemes; they are new schemes About Rs. 6,870 Crore bills pertaining to FY 2014-15 were deferred for want of resources#8Total Expenditure /Gap (1) Resource Gap for the year 2014-15 Amount due to AP towards Resource Gap for FY 2014-15 Purpose of Expenditure (Expenditure incurred in 2014-15) Amount that (Rs. in Crore) Unusual, non- standardized constitutes Resource Gap as expenditure - per standardized discretionary norms (1) (2) (3) (4) Financial Assistance to DISCOMS 1,500.00 1,500.00 Social Security Pensions (Gol normal subsidy + State's 3,575.81 1,985.07 1,590.74 mandatory share) Agricultural debt redemption 3,068.35 3,068.35 Rythu Sadhikaara Samstha 4,001.32 4,001.32 Deferred Expenditure - Under Accrual Accounting PRC arrears 3,920.00 3,920.00 Deferred Bills 2,950.00 2,950.00 Total: 19,015.48 10,355.07 8,660.41 8#9(1) Resource Gap for the year 2014-15 S No. Items Rejected Amount (Rs in Crore) 1 Loan waivers Comments View • New program 7,069.70 • Non-standardised expenditure • • Ongoing programme Nation-wide programme • OGOI initiative • Pre-existing commitment GOI is not duty bound to compensate. It is discretionary • GOI should compensate 2 Financial Allocation to DISCOMS 1,500.00 • Standardized expenditure • Ongoing programme 3 Social Security Pensions 3,391.20 • Matching fund equal to GOI grant is standardized expenditure • GOI should compensate Rs.1985.07 Crore Balance amount of Rs.1590.74 Crore is discretionary 9#10(1) Resource Gap for the year 2014-15 Amount (Rs in Crore) Comments View S no. Items Rejected 4 Deferred expenditure a. PRC arrears 3,920.00 b. Deferred bills 2,950.00 • Ongoing program PRC report submitted on 29th May 2014 . Fitment benefit of 43% is on par with Telangana State GOI is duty bound to compensate • • Pattern followed is similar to earlier Pay Revisions in United Andhra Pradesh Legally binding commitment Payment to employees was deferred for want of resources Therefore it is legitimate and standardized expenditure • Expenditure pertaining to deferred bills was • • necessary, predictable and standardized Pertains entirely to State government expenditure relating to binding commitments arising in FY 2014-15, not local governments or parastatals in Public Account Expenditure was subsequently incurred in 2016-17, and the bills were passed by Treasury as ways and means position improved • All these, constitute legitimate revenue expenditure due in 2014-15, but could not be incurred due to lack of funds and payment was deferred to subsequent year Subject to such verification, these amounts constitute legitimate resource Gap in 2014-15, and should be compensated by the Union as per the commitments made to compensate the Resource Gap 10#11(1) Resource Gap for the year 2014-15 Recommendations: . • The actual, unfunded Resource Gap for FY 2014-15 was Rs.19,015.48 Crore including expenditure already incurred, and expenditure deferred because of ways and means problems and lack of funds despite liability to pay. Of this, Rs. 10,335.07 Crore is clearly the Resource Gap based on standardized expenditure, subject to verification of bills pending and payments deferred as on 31 March 2015. This amount should be compensated by the Union as per the letter and spirit of the Andhra Pradesh Reorganisation Act (APRA), 2014 and the Prime Minister's solemn commitment in Parliament preceding the approval of the law. The balance of Rs. 8,660.41 Crore does constitute genuine Resource Gap, though may be considered as pertaining to New Schemes and non-standardized expenditure, and Government of India may decide based on its discretion. 11#12(2) Loss incurred on account of anomalies of law Revenue and Liabilities based on AP Reorganisation Act Andhra Pradesh Telangana Revenue and Liabilities if anomaly in law is corrected 1. Arrears (Section 50) 2725.16 6699.53 Total (Rs. in Cr) 9424.69 Andhra Pradesh Telangana Total (58.32%) (41.68%) (Rs. in Cr) 1. Arrears 5496.47 3928.22 9424.69 2. Deferred taxes treated as 698.90 2298.28 2997.18 loans (Section 51) 2. Deferred taxes treated as loans 1747.95 1249.23 2997.18 3. Refunds (Section 56 ) Net Revenue [(1+2)-3] 402.86 3021.20 287.92 8709.89 690.78 3. Refunds 402.86 287.92 690.78 11,731.09 Net Revenue [(1+2)-3] 6841.56 4889.51 11731.09 Loss of Net Revenue incurred by the State of Andhra Pradesh on account of the anomaly is Rs. 3820.36 Crore (Net Revenue) If anomaly is corrected - Rs. 6841.56 Crore Net Revenue under present law: Rs. 3021.20 Crore · Loss: Rs. 6,841.56 Crore - Rs. 3,021.20 Crore = Rs.3,820.36 Crore Recommendation Net Loss of Revenue to the State of Andhra Pradesh on account of the anomaly is Rs. 3,820.36 Crore (Net Revenue). This amount, subject to verification, should be compensated by the Union government, as the anomaly was a result of flawed provisions of the law of Parliament 12#13(3)Special Assistance in lieu of 90% Union funding for Centrally Sponsored Schemes Grants-in-aid from the Union to AP under CSS (* in Crores) Grants- in-aid As per Existing sharing pattern suggested sharing pattern Union: AP State 90:10 under CSS Union State Union State 1 2 5 2015-16 3 4 6 9592.29 5755.37 3836.92 8633.06 959.23 Additional grant to AP if 90:10 is applied 7 = (col 4-col 6) 2877.69 An amount of Rs. 16,447 Crore is due from the Union Government in lieu of 90% in CSS. The EAP is wholly insufficient to extend this Special Assistance. The disbursements so far are miniscule. Recommendation: Therefore, assistance should be given by other means including 2016-17 12081.19 7248.71 4832.48 10873.07 1208.12 2017-18 RE 14670.38 8802.23 5868.15 13203.34 2018-19 BE 16608.72 9965.23 6643.49 14947.85 3624.36 1467.04 1660.87 4401.11 4982.62 Total 52952.58 31771.55 21181.03 47657.32 5295.26 15885.77 Data compiled by CESS expert team The CESS team arrived at a figure of Rs 15,885.77 Crore for the period 2015-16 to 2018-19, based on the Andhra Pradesh Government's detailed estimates of revenue and receipts • permitting the State to clear other outstanding EAP loans, Special Development Loans, other dues to Government of India or to parastatals of Government of India; permitting borrowing from internal lenders like NABARD, HUDCO, etc. in lieu of the grant; exempting the Special Assistance from the State's FRBM limit since the repayment responsibility of the EAPS will be taken up by the Government of India; and issuing short/medium tenure Andhra Pradesh Relief Bonds, so on. 13#14(4) Assistance required for completing Polavaram Project Polavaram Project Financial Progress and Reimbursement S. No Item 1 Approved Cost of the Project (2010-11 price level) 2 Cost of Power Component Amount (in Rs. Crore) 16,010.45 3716.05 3 Cost of Irrigation Component (2010-11 price level) 12,294.40 4 Expenditure incurred on the project before declaration as a National Project 5,135.87 5 Total Expenditure incurred on the project from inception to Dec 2018 15,205.33 6 Expenditure incurred after declaration as National Project up to Dec 2018 10,069.66 7 Total funds released to the State Government through Polavaram Project Authority after declaring it as National Project 6,727.26 80 Balance reimbursement due from Gol for the expenditure already made on the project by the State of AP as National Project Source: Report on AP Water Resources Department as on 17 December 2018 3,342.40 14#15(4) The assistance required for completing Polavaram Project Phase - I Phase - II Fund required for completion of Polavaram Irrigation Project Head Works from +41.15 Mts to +45.72 Mts Polavaram National Project - Irrigation Component Funds needed from Govt. of India for completion of Phase-I - EL +41.15m Sl.No. Rs. in Crore 1 YEAR 2019-20 Land Acquisition WORKS and R&R Miscellaneous Rs. in Crore TOTAL Apr-19 200 2,000 40 2,240 May-19 225 3,000 80 3,305 *Amount required for main works (As on 9 April 2018) 2,874.68 Jun-19 225 4,500 80 4,805 Jul-19 150 5,000 75 5,225 *Amount required for land acquisition and R & R 2,494.11 Aug-19 125 4,500 60 4,685 (as on 21st October 2018) Sep-19 150 3,000 55 3,205 Amount already utilized, and reimbursement 3342.40 Oct-19 350 1,500 60 1,910 from Government of India due (as on 17th December 2018) Nov-19 300 800 55 1,155 TOTAL 8,711.19 Dec-19 375 525 64 964 GRAND TOTAL 2,100 24,825 569 27,494 *These estimates are based on information available so far, and are subject to correction as the project work progresses. These are rough estimates as on 9th April 2018. Figures are subject to revision 15#16(4) Assistance required for completing Polavaram Project Present Status : • • . State contribution - Rs. 5,135.87 Crore Rs. 6,727.26 Crore reimbursed to State after Polavaram being declared as National Project Balance reimbursement of expenditure already incurred to be made by Gol - Rs. 3,342.40 Crore Recommendations : . • The Project is a model of cooperation between the Union and the State Execution by the State under the Union's supervision has been vindicated by the speed and efficiency of execution To complete Phase I of the Project, a further Rs. 8,711.19 Crore (EL +41.15 m) is required To complete Phase II of the Project Rs. 27,494 Crore (from +41.15 m to +45.72 m) is required Revised cost estimates may be approved by the Union as per norms The Union and State should take steps to complete the project as per proposed schedule At present, funds are first spent by the State, and reimbursed by the Union later Quarterly advances to the State, and timely utilization certificates by State before the next advance would help smooth execution of project as State finances are under stress 16#17(5) Development Assistance to Backward Regions Kurnool Anantapur Cuddapah Chittoor Vijayanagaram Visakhapatnam Seven Backward Districts of Andhra Pradesh Srikakulam The total population of backward areas of AP is 2.52 Crore. If a per capita grant similar to Bundelkhand package at 2009 prices is made to the seven backward districts of North Coastal Andhra and Rayalaseema (including Markapur division of Prakasam district, which forms part of Rayalaseema), the grant should be of the order of Rs. 35,000 Crore at current prices adjusting for population and Budget Multiplier If, however, the adjustment is made for population and 5% inflation, then the grant to backward regions of Andhra Pradesh on par with Bundelkhand Package will be of the order of Rs. 25,000 Crore. The demand of AP Government is Rs. 24,350 Crore An amount of Rs.1,050 Crore has been disbursed so far over 3 years as special package for backward areas and a further amount of Rs.700 Crore would be paid in the coming years The Union should take steps on priority basis to implement the Special Package of Rs. 24,350 Crore in a time bound manner with a period of five years otherwise purpose will be defeated 17#18(6) Major Port at Duggirajapatnam and/or Alternative The tentative cost for Duggirajapatnam has been estimated at Rs. 7,988 crore by the Technical Committee set up by Ministry of Shipping. Kalaburagi dexsich Deosugur Raichu TELANGANA Hyderabad హైదరాబాద్ Kurnool Suryapet సూర్యాపేట Khammam ఖమ్మం. Kakinada Rajahmundry కాకినాడ రాజమండ్రి Vijayawada Bea విజయవాడ b Guntur గుంటూరు KA anagere Seand Ballan TALK Anantapur Sceydo AH47 Tumakuru ababdad Bengaluru Borsted ANDHRA PRADESH Kadapa Truput ede Ongola NO Kav Nellore KRISHNAPATNAM PORT DUGARAJAPATNAM Visakhi De nasti Krishnapatnam KRISHNAPATNAM PORT Gudur 11504506 Mettu మెట్టు Naidupeta నాయుడుపేట 43 KMS DUGARAJAPATNAM Sriharikota Sullurupeta శ్రీహరికోట సూళ్లూరుపేట Varadaiahpalem Pulica Lake వరదయ్యపాలెం Sri City Bel పులికాట్ లేదా 71 KMS| 91 KMS Gummudipoondi Palicat கும்மிடிப்பூண்டி புலிகட் PENNORE PORT Recommendation: The Union government concluded that the location is unviable, and asked the State to suggest an alternative location. The Union and the State should resolve the issue of viability and decide on the location of a viable project expeditiously, and swiftly. implement the Major Port project in Andhra Pradesh without delay. ENNORE PORT Ch Velbre வேலூர் 6 CHENNAI PORT 716) Tiruvallur திருவள்ளூர், 716 Chea Google My Maps CHENNAI PORT Sriperumbudur 18#19(7) Establishment of eleven nationally important institutions in Andhra Pradesh . Rs. 12,746.38 Crore is the estimated cost for all the eleven projects put together • Only Rs. 845.52 Crore i.e. 6.63% of the total project cost is released by Gol; 93% is still remaining State already fulfilled its commitment The remaining funds need to be released faster Status of Educational Institutions sanctioned under Schedule XIII of the Andhra Pradesh Reorganisation Act, 2014 1613Cr. revised) Contribution of GOAP (Rs. in Crores, updated on 12.11.2018 Funds released by Gol Central 5 Anantapur University, (website) 1100.00 491.23 2.00 10.00 5.00 *5.00 ប៖ SI. No Institute Project Cost (excluding GOAP contribution) Land allotted Funds released for LA/ compound 2014- 17 (Source) in Acres wall constructio 2017- 18 Releas es 2018-19 Budget Estimate 2018- 19 Releas es Total Release S Remarks IIPE 6 (6+7+ 9) Visakhap atnam 655.00 (Director, IIPE) 201.80 68.00 32.00 1.00 32.00 *33.00 1 2 3 4 5 6 7 8 9 10 10 11 Agricultural 1505.82 7 Classes University, Guntur (Registrar, ANGRAU) 110.00 0.95 135.00 65.00 *135.00 commenced in 2015-16. Transit 3125.49 IIT, 1 Tirupati (Director, IIT Tirupati) 566.61 8.30 36.99 61.30 50.00 22.41 *120.70 campus construction in 8 progress. Hande IIITDM, Kurnool 297.00 (Director, IIITDM) 151.51 6.16 20.10 30.00 18.82 *38.92 over 530.11 και τιμής Classes to commenced in 2018-19 in Temporary campus. Transit campus handed over by GOAP on 04.07.2018. Classes commenced in 2016-17 in Temporary campus. Classes commenced in 2015-16 in Temporary campus. This is run as a State University. O Classes commenced in 2015-16 in Temporary campus NIT, 2 Tadepalli gudem 460.50 (Director, NIT) 172.08 7.10 10.00 50.00 54.00 44.50 450 1376.52 *104.50 acres. Classes 2015-16 in Classes AIIMS, commenced in 9 iri Mangalag (M/H & FW, Gol) 1618.00 183.11 20.00 86.01 Classes to commence from 127.87 *233.88 2018-19 in Temporary IIM, (Director, IIM. 3 Visakhap Earlier DPR for 4.25 30.97 24.99 57.20 *55.97 commenced in 2015-16 in 10 Tribal 10 University, 420.00 526.24 5.00 10.00 campus Not established Vizianagar (MHRD) 241.50 atnam Rs. 691.58 Cr. Temporary am revised) campus. NIDM, 11 2117.18 Classes a 70.87 Vijayawad (NIDM, New Delhi) 10.00 23.07 10.00 3.43 *3.43 Functioning from temporary campus from 2016-17 (Registrar, commenced in IISER, 4 IISER. Earlier 255.09 6.50 69.00 35.02 49.00 11.00 *115.02 2015-16 in Total 12746.38 2909.17 131.33 354.06 258.33 352.00 233.03 845.42 Tirupati DPR for Rs. Temporary 1613Cr revised campus * Deputy Secretary (CS-I&II), Ministry of Home Affairs (CS Division), Gol, New Delhi has furnished funds released to various institutions in Lr. F.No. 12025/01/2018-SR, Dt: 22.10.2018.#20(8) Projects to improve infrastructure, connectivity and investments in Andhra Pradesh Rail Connectivity : Estimated Cost : Rs.3,272.03 Crore Road Connectivity Road Project Hyderabad-Suryapeta-Kodad-Nandigama- Vijayawada-Amaravati - (NH-65) - 275 Kms Hyderabad-Nagarjunasagar-Macharla (Covered by NH-565) - Rentachintala- Dachepalli-Piduguralla-Sattenapalli- Perecharla-Guntur-Amaravati - 290 Kms Amaravati/Vijayawada-Ibrahimpatnam- Tiruvuuru-Bhadrachalam-Jagdalpur - (NH-30) -171 Kms upto Bhadrachalam Anantapuramu-Amaravati Expressway (Green-Field Expressway) Amaravati Outer Ring Road (ORR) - 180 Kms Status NHAI needs to initiate action for 6-laning of the road Upgradation as National Highway and sanctioning of works pending Not yet started In-principle agreement by Ministry of Road Transport and Highways (MORTH) for taking up Expressway project by NHAI DPR is under-preparation by NHAI • Total length of the project is 106.56 km which includes • • • 56.53 km double Broad-Gauge (BG) line between Errupalem -Amaravathi-Nambur (Section I) 23.78 km single BG line between Amaravathi- Pedakurpadu and (Section II) & 26.25 km single BG line between Sattenapalli- Narasaraopet.(Section III) Status Yet to be sanctioned Recommendation : Government of India should implement the DPR for providing Rail connectivity and the five projects for providing Road connectivity to the new Capital of Andhra Pradesh, in a time bound manner 20#21S no (8) Projects to improve infrastructure, connectivity and investments in Andhra Pradesh Project Recommendation 1 2 3 4 Vizag Chennai Industrial Corridor Expansion of airports at Visakhapatnam, Vijayawada and Tirupati to International Standards Metro Rail Projects at Vizag (Rs. 8,800 Crore) and Vijayawada-Guntur-Tenali (Rs. 6,769 Crore) Petro-Chemical Complex 5 A New Railway Zone The Union should include the project under the NICDIT on the lines of Delhi-Mumbai Industrial Corridor (DMIC) and provide 100% grant funding Visakhapatnam - A techno-economic feasibility report is to be undertaken by the State Government Vijayawada and Tirupati - The State Government's request to accord the status of 'Port of Call' to Vijayawada and Tirupati airports may be conceded by including them in existing bilateral agreements Andhra Pradesh has no major cities, and mass rapid transit systems will help accelerate city development. Therefore, the State's request for Viability Gap Funding (VGF) and fast-track approvals for Vijayawada and Visakhapatnam Metro Rail Projects may be conceded. Government of India should provide the Viability Gap Funding generously, so that the project can be executed Creation of a New Railway Zone is a relatively low-cost demand, but a highly emotive issue. Therefore, Government of India may concede the demand expeditiously and create a New Railway Zone 60 Integrated Steel Plant Gol stated that the project is non-viable The State government announced its decision to establish it as a State enterprise 21#22(8) Projects to improve infrastructure, connectivity and investments in Andhra Pradesh Recommendation: • . A review of all the Schedule XIII Infrastructure Project shows that five of the projects have not been implemented, and three of them are in initial stages of implementation. Of these, Petrochemical Complex, Metro Rail Projects, Vizag-Chennai Industrial Corridor (VCIC), rapid rail and road connectivity to the Capital Region and International airports are critical. These projects will stimulate economic activity, further investments, industrialisation and job- creation in the State which has relatively low level of employment in industries and services. Therefore, Government of India should provide generous assistance to these projects which have multiplier effects on the economy of the State. 22 22#23(9) Assistance to develop Government Infrastructure and the Capital City region GOAP's ambitious plan for the new capital Rs. In Crores Government Complex Social Infrastructure 11,261 7,330 Trunk/Tier-1 Infrastructure 70,682 Tier-2 Infrastructure (LPS and Others) 19,750 Total: 1,09,023 Present Status So far, Rs. 1,500 Crore has been released for the Capital City development and the State furnished a Utilization Certificate for Rs. 1,632.48 Crore based on which NITI Aayog recommended release of Rs. 666 Crore immediately with a promise of Rs. 334 Crore in 2019-20. Separately, Rs. 1,000 Crore has been released for Under-Ground and Storm Water Drainage for Vijayawada and Guntur cities. 23#24(9) Assistance to develop Government Infrastructure and the Capital City region Recommendation: • The DPRS furnished to NITI Aayog/Government of India by the State, and those under preparation include all projects related to development of Amaravati as a major green- field city. Of these projects, the Government Complex along with the necessary civic infrastructure, and Other Essential Infrastructure (roads, storm water drainage, flood proofing, sanitation and sewerage, drinking water, rapid connectivity and mass rapid transport system) should be treated as projects coming under the scope of Section 94 (3) of APRA, 2014. The Union Government may constitute a committee of urban planning and development experts to identify the projects related to ‘Essential facilities,' and 'Other Essential Infrastructure' covering the items listed above, review the cost estimates furnished in DPRs and assess the requirement of resources for those items. On the basis of such assessment, assistance should be provided to the State by the Union. Government of India should expedite transfer of the forest land (2087.09 ha) and release the approved project cost of Rs. 219.16 Crore for the Greyhound Training Centre. 24#25(10) Tax and other incentives for investment in Andhra Pradesh Union's Difficulties Demands from other States Opposition from neighbouring states AP's relatively large population compared to other Special Category States Possible Approaches Limiting concessions to backward areas. Concessions short of full exemption but more than offered now Extension of concessions to other identified backward regions in the country Recommendations: In addition, massive infrastructural projects need to be taken up in Andhra Pradesh with 100% contribution from the Union Government in a time-bound manner. In particular, special programmes based on natural resources, local skill-base and market potential could be taken up on the lines of cluster development initiatives such as Industrial Infrastructure Up-gradation Scheme (IIUS), Mega Food Park Scheme, Integrated Infrastructure Development (IID) Scheme, etc. 25