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The Amaravati capital city project in Andhra Pradesh is set to receive the second tranche of USD 200 million from the World Bank by the end of this year, a senior state government official confirmed. The World Bank and Asian Development Bank have each pledged USD 800 million, bringing the total external funding to USD 1.6 billion (INR 13,600 crore). The Centre will also contribute INR 1,400 crore from its INR 15,000-crore commitment. Of the first disbursement of USD 207 million, nearly half has been spent. Both funding agencies are conducting regular monthly reviews of the project.
The World Bank is expected to release the second tranche of USD 200 million for the Amaravati capital city Phase-I development by the end of this year, according to a senior Andhra Pradesh government official. The funding forms part of the Bank's total commitment of USD 800 million for the project, which is being developed in collaboration with the Asian Development Bank (ADB). Both institutions have pledged USD 800 million each, amounting to USD 1.6 billion (INR 13,600 crore) for the capital city's initial development phase. Advertisement
In addition to multilateral funding, the central government has committed INR 15,000 crore towards the project, of which INR 1,400 crore will be allocated for Phase-I. The World Bank has already released USD 207 million as the first disbursement under the programme. According to S. Suresh Kumar, Principal Secretary of Municipal Administration and Urban Development, approximately INR 1,800 crore has been received so far, with less than 50 per cent of the amount utilised. He stated that the next instalment, expected to be of a similar amount, is likely to be claimed before December once the state government spends about 75 per cent of the first tranche.
Monthly inspections are carried out by both the World Bank and the ADB to review progress. Teams from the two agencies verify financial records, interact with officials from the Capital Region Development Authority (CRDA), and conduct on-ground inspections. Regular meetings are also held with senior officials overseeing the development.
In its recent project update, the World Bank noted that the overall implementation progress of the Amaravati Capital City Project was satisfactory. The Bank confirmed that the first disbursement of USD 207 million was made in March 2025 under the Program Advance, after meeting key milestones such as the commencement of construction and the establishment of the Environmental and Social Management Unit.
The International Bank for Reconstruction and Development (IBRD), a part of the World Bank Group that lends to middle-income and creditworthy low-income countries, is providing the USD 800 million loan for the project. According to official documents, the Department of Economic Affairs serves as the borrower, while the Andhra Pradesh Capital Region Development Authority (APCRDA) acts as the implementing agency.
Amaravati's development project was initiated to create a planned capital city for Andhra Pradesh after the 2014 bifurcation of the state. Over the years, the project has faced challenges due to funding issues and changes in policy direction. The renewed progress in Phase-I with World Bank and ADB participation signals a more structured approach towards completing critical infrastructure, including roads, civic utilities, and government complexes in the core area.
Source PTI
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