Building a revenue-earning city to compensate for the loss of Hyderabad ‘perverted thinking’: Jaganmohan Reddy

Chief minister Jaganmohan Reddy has rejected the idea of building a revenue-earning city to compensate for the loss of Hyderabad to Telangana when Andhra Pradesh was bifurcated in 2014, calling it “perverted thinking” as mega-cities bring no additional income and instead lead to debt. “Nowhere in the world has it been proved. Major cities grow over the decades and centuries. Investing Rs 1,00,000 crore to build a mega metro is not viable. Forget about additional revenue, you cannot even repay the debt [incurred by spending] …on infrastructure,” Reddy said in an interview to HT.

He was responding to a question on his predecessor Chandrababu Naidu’s idea to build a revenue-earning city comparable to Bengaluru, Chennai, and Hyderabad and why not much has been heard of that since Reddy took over.

Reddy cited the example of Omaha city in the Midwestern US state of Nebraska with a population of just 400,000. He added 23 of the largest US corporations are headquartered there. “That is where [business tycoon] Warren Buffett stays. [Business magnate and Microsoft co-founder] Bill Gates operates from Seattle [in the northwestern US state of Washington with a population of 608,660],” he said.

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Reddy underlined mega-cities are unwanted, and only drain resources and become a burden on the people. He said none of the top 10 developed countries have a metro and a mega city. “Norway, Sweden, Denmark, Switzerland, and Finland…all these developed countries have no mega-cities. Development is not industrialisation or urbanisation. Development means many things like per capita income and happiness index.”

Reddy said Kerala, too, has no major cities and yet is ahead of other states in terms of several parameters. “Development has to be distributed across the state. Visakhapatnam, Anantapuram, Kurnool and Tirupati, and a few other cities can become clusters of development. Ports are being developed. Central Andhra, which is an agriculture hub, can have some agro-logistic parks and all can prosper.”

Reddy argued revenue gets generated through manufacturing and a proper service sector. “Why should the industry be located in urban areas? For instance, Visakhapatnam is not our capital. When it was a small town, a steel plant and a few other industries were set up there a few decades ago. Now, it is emerging as a major city.” He added in a similar way, they can have growth centres where industries can be promoted. “The Covid-19 experience tells us that most of the cities ultimately become sick. There is a gradual shift from the so-called major cities or metros to medium and small towns.”

Reddy argued against pouring money into building a congested and “a not required urban place”. He added money should instead be spent on connecting places and ensuring faster mobility and cost-effectiveness. “It is a wrong perception that cities generate more money. Barring a couple of exceptions, greenfield capital cities did not succeed anywhere in the world.”

He questioned whether the state has resources to build Amravati as per Naidu’s plan. “[US management consulting firm] Boston Consulting Group analysed it from an economic perspective and said its investments are not viable.”

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He defended his plans to have separate capitals for executive, judicial, and the legislative arms of the state in Visakhapatnam, Kurnool, and Amravati, saying they should not put all their eggs in one basket. “The capital’s functions can be distributed among different places. Why all these functions should be delivered from a particular place? The residuary state of Andhra Pradesh suffered twice in the past on account of [loss of] Chennai and Hyderabad. That is what history tells us. If you put all your eggs in one basket, you are going to suffer. Then why you want to continue with the same approach without taking into account past experiences? It is not logical and rationale thinking,” he said. “The document prepared by the previous [Naidu] regime says that you need Rs 1,00,000 crore [for building the new capital in Amravati]. Instead of planning to build a so-called city at a place which is not suitable for construction of any mega structures on 33,000 acres land acquired or pooled from farmers, he could have planned something on 500 acres elsewhere.”

Reddy said a special investigating team is probing land deals of his predecessor and “his cronies”. “People with vested interests purchased lands from poor farmers. Then came the announcement of the capital and subsequent scam. Those who purchased land at throwaway prices benefited to the tune of thousands of crores of rupees. It was just a real estate business by the previous regime to benefit a certain section of people. Once the development is diversified and spread across the state, they become centres of growth…”

Reddy rejected as absurd the suggestion that he wanted to downgrade Amravati to slight Naidu. “Why should we bother about Amravati? We believe in the overall development of the state. We did not leave Amravati. The legislature will continue to work from Amravati.” He added had there been a referendum option available, they would have gone for it over Amravati. “We are confident the people would have given a thumbs up for our decentralised development.”

A group of farmers have in the high court challenged the move to have three capitals, saying Amravati was made the capital as per a presidential order. The state cannot have three capitals in violation of the order, the farmers have argued.

As many as 55 petitions have been filed in the high court challenging the law for the creation of three capitals and abolition of the Capital Region Development Authority for the development of Amravati as the state capital.

The Supreme Court last month refused to stay a high court order for the status quo on continuing Amravati as the state capital. It said it cannot interfere in the matter as it was pending before the high court. The Supreme Court also rejected the state government’s plea to direct the high court to expedite the hearing in the case.

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