In a blow to Andhra Pradesh Chief Minister N. Chandrababu Naidu, the high court ordered a stay on the state government’s controversial ‘Swiss Challenge’ model for the construction of the capital city of Amaravati. The court order came on petitions filed by Aditya Housing Company and Envian Engineering Pvt Ltd, which accused the government of wanting to hand over the contract to the Singapore consortium without calling for competing bids.
The HC ordered that the state government reveal the revenue sharing model offered by the consortium in order to allow other interested parties to make a counter offer.
The order is likely to further delay the construction of the capital city by the Capital Region Development Authority (CRDA). The Swiss Challenge notification is now deemed to be canceled after the high court’s stay order. The high court has also observed that along with irregularities, the model also lacks transparency and directed the AP government to file counter bids by September 13.
The TDP government, however, is planning to move the supreme court.
By adopting Swiss Challenge model, the state government had roped in a Singapore consortium, which holds 58 per cent stake in the project. The remaining 42 per cent is owned by the state government.
The AP government had faced another jolt from the World Bank (WB) and Asian Development Bank (ADB) who had turned down the state’s applications for loan as it has not obtained clearance from the National Green Tribunal (NGT). The CRDA had sought Rs 7,500 crore from each and the WB team had recently visited Amaravati. The WB said it would extend loans only after the state government got clearance from the NGT.
Though the government tried to convince them that since the land acquisition was done under the Land Pooling Scheme (LPS), social impact assessment (SIA) report would not be required for the sanction of the loan, the World Bank officials didn't seem to be convinced.