Andhra Pradesh Capital City, Propaganda, Smoke n Mirrors.



After being active on social media for past few months, realised the importance of providing alternate view for people to form their opinions based on multiplicity of views and not just based on propaganda of vested interests. This is my humble attempt at it.

Today I will focus on the interview by MG Devasahayam (MGD in short here after), a retired IAS officer regarding proposed AP capital. Here is the counter view…

MGD : My first question is — for what do you need 30,000 acres of land? What kind of a capital are you planning to build and for whom? When someone plans to build a house, the first thing he would think of is, how many people are going to live in the house and what kind of facilities or reasonable comfort they need. For a small family of four, you don’t need a 5 bedroom house and for a joint family of 15, 20 people, you will need more bedrooms. You will decide the size of the plot according to your needs. You don’t need 10 acres of land to build a house for a family of four. Most importantly, you have to decide whether you have the income to maintain the house. These are the basic things anyone should look into while building a house. Here, you are talking about a state capital and nothing, not even a feasibility study was done. What you need first is a need analysis.

Counter View: Let us start with one of the recently formed state Chattishgarh. It has a land mass of 1.35L SqKms with a population 24.58Million (source wikipedia). Compare this with Andhra Pradesh which has a land mass of 1.6L Sq. Kms with a population of 49.67M (source wikipedia). Andhra Pradesh has a population density of 310/sqkm vs 182/sqkm, in other words Andhra Pradesh is 70% more densely populated than Chattisgarh. Chattisgarh has forest cover of 41.3% and 20% living in urban areas. Andhra Pradesh has a forest cover of 14.27% and 30% living in urban areas (not factoring in any of reverse migration from Hyderabad, other states). Factoring all of the above, Andhra Pradesh is likely to have 65% more urban population density than Chattisgarh. If Chattisgarh has acquired 20000 acres for its new capital, with similar assumptions of Chattisgarh and higher urban population density, Andhra Pradesh need to plan for at least 33000 acres. If Chattishgarh is correct to acquire 20000 acres, then Andhra Pradesh by same logic is certainly correct to plan for 30000 acre capital.

MSG: The Sivaramakrishnan committee report set up by the Government of India under the Andhra Pradesh Reorganisation Act says there is no need to build a new capital! Sivaramakrishnan is a very senior IAS officer and an urban planning specialist. There were 3, 4 very eminent city planners also in the committee.

Counter View: Sivaramakrishnan committee is formed to make recommendations, which is NOT binding on the state government. It is ultimately the state govt which needs to make the decision. If Srikrishna committee report which recommended against bifurcation can be thrown aside, how can Sivaramakrishnan committee report be assumed that it is sacrosanct.

MSG: I was shocked. They are cheating people. What will happen now is that real estate speculation will artificially increase the land price. Land that was sold for Rs 1 lakh (Rs 100,000) is already worth Rs 1 to 2 crores (Rs 10 million to Rs 20 million) now; all because of artificial land speculation. The land mafia is taking advantage of this. They are luring farmers by telling them that their farming land would have no value soon. That is the biggest crime — that too they are doing by cheating poor farmers who have 1 to 2 acres of land. They are in fact, acquiring agricultural land almost free of cost promising an illusory rise which is worse than a chit fund scheme. At least in chit funds, you are giving money but here, it is your land, which you will never be able to get back.

Counter View: Multi-crop lands in Krishna delta had valuation of 10-15L prior to the capital. If the land valuation is only 1L and farmers are earning 1L/year, then most of them would have reinvested in land, and there shouldn’t be any small land holders at all, but there are lot of small farmer. This means that the farmers don’t get 1L/acre or the land value is much higher than 1L/acre or both. Second point, through farming none of these farmers would even make 50L/acres in the next 30 years. If land mafia is luring farmers by jacking up prices 100x, isn’t it one of the best deals farmers are going to get. If land value crashes subsequently, then it is the land mafia not the farmers who will loose out. I don’t quite understand how farmers are cheated out in this scheme.

Under land pooling govt is going to give 1000 sq yds of housing plot and 200 sq yds of commercial plot. In any of the capital regions across India, I bet 1000 sq yds in core capital region will fetch at least 25-30L, and 200 sq yds commercial plot another 25L. In other words 50L at the least for the land valued at 1L by MSG (15L by me). Isn’t 50x valuation, a pro-farmer and a fantastic deal.

Now this kind of valuation is happening only because of the capital not otherwise. It is hypocritical/greedy to say that I want the valuation benefits of the capital, but won’t give my land. Interests of state far trump individual interests.

MSG: When I went there on a fact finding mission, we found that one third of the land they plan to acquire is the best agricultural land in the country. It is a multi crop land where the farmers harvest around 100 varieties of crops.

Counter View: Canal discharge capacity under Krishna Barrage is limited.During rainy season when flood water is available existing canal capacity doesn’t allow for quick evacuation of water leading to a lot of discharge to sea. There is an argument to build another canal to augment the existing evacuation capacity. Obviously this canal will pass thru the same fertile lands, but we won’t be complaining right. We compare the greater good of irrigation canal, why is it that capital not seen in the same context. Capital city will create a new economy and provides lot more opportunities to people.

Earnings potential in farming is fairly limited with lot of price controls. Is it fair to say that those who depend on farming for ever need to be farmers and govt cannot help them leverage value out of their lands. Irrespective of the capital, lot of acres of land are already converted into residential with apartments mushrooming. Are we saying that it is okay for the property developers to convert these lands to residential, but govt is not supposed to construct capital in the same lands.

MSG: I think it is a major black money transaction that is happening from Singapore. Today, Singapore is one of the black money havens in the world. The earlier havens have vanished and they are replaced by some of the Middle East countries and Singapore. The entire thing is controlled by black money, the real estate mafia and they are dealing with one of the most beautiful river fronts and highly fertile land.

Counter View: Singapore may be a black money transaction haven (I am not sure it is), but MSG has not made any argument on how it fits in the context of land pooling. If land mafia is investing black money to inflate the land prices and buying land, they still have to give these lands to govt under land pooling (or land acquisition later). That being the case isn’t it good that black money is coming back to India and the farmer benefits because of the inflated land value. If MSG argument is that black money is used to inflate land values, and prices will eventually crash, then those with black money are doing greatest favour to the country as they are buying lands at inflated value, and not even going to get their investment let alone profits. Interesting way of loosing money right, for me it just sounds absurd.

MSG: The National Alliance of People’s Movements finds that there is no legal sanctity to the approach taken by the government on land-pooling.

Counter View: Majority of real estate development is done on joint development agreements which have absolute legal sanctity. As a matter of fact DDA is pursuing land pooling of 59000 acres since 2013, and the first announcement of intent was in 2013 during UPA rule. I don’t think MSG or any of the members of NAPM claimed that there is no legal sanctity or it is all about black money. Land pooling offers a share in the developed property as compared to outright sale to the govt. Even the land acquisition bill advocates giving farmers share in the property constructed on the land acquired.

MSG: The farmers should disregard the threats that their lands will be forcefully taken if they do not agree to land-pooling. We call on the AP government to completely revamp their misguided approach to the capital development and put up their plans transparently for a public debate and follow the due process of law.

Counter View: Land pooling is done with the consent of the farmer. Farmers do not have to give their consent, if they don’t agree to parting their lands. If there is any coercion, then can always approach courts. NGO/NAPM can play a greater role is providing grievance cells in case of coercion and help people approach courts for legal remedies.

MSG: Rather than serving the real estate mafia and big businesspersons, the government should proceed in a manner that serves the interests of all local people including the majority of residents who are not land-owners.

Counter View: It is the govt which is acquiring the land under land pooling, not real estate mafia. Claiming that it is done to benefit real estate mafia & big business persons is not only mischievous but out right falsehood. MSG need to explain how land pooling is helping the interests of real estate mafia and/or big business persons.

MSG: In the last one month, they have enacted an Act to send police to the villages to make farmers sign documents. What they are doing is illegal. We are observing all this very carefully.

Counter View: I am shocked that a learned person like MSG is resorting to such cheap remarks. CRDA doesn’t talk of police getting farmers to sign the documents. If not CRDA which act is being referred to, as I am not aware of any other act pertaining the capital region.

MSG: We plan to hold public protests in the areas where land grabbing is taking place. There are three avenues legally. One, you can go to the Human Rights Commission as it affects livelihood and fundamental rights of the 30,000, 40,000 people. Two, as it is a major violation of the Environmental Protection Act, we can go to the Green Tribunal. Three, as it is a violation of the Constitution of India and Land Acquisition Act, we can go to the high court and the Supreme Court.

Counter View: This is one and only thing I agree with MSG. Educating people on their rights and legal remedies is the way to go forward. If there are any violations of existing laws then they need to be challenged in the appropriate forums.

Having said that East Godavari has very fertile lands. Does that mean under the guise of environmental protection or green tribunal, we should stop all in-land oil/gas exploration, stop any industry coming up, and leave the district forever agriculture belt only. Assuming that is the right approach, how do we compensate people of that district for falling behind on development compared to other districts and lack of local employment?

MSG: Firstly, I feel this project should not be discussed at all in any public forum. The Sivaramakrishnan Committee report says such a project is not needed. Why can’t the government adhere to that? Why didn’t they go for a detailed study?

Counter View: On one hand MSG advocates public discussion and on other hand says that the project should not be discussed in any public forum.

MSG: Only a coterie of ministers and officials — not even the entire TDP (Telugu Desam Party) members — are under the orders of black money, the real estate mafia.

Counter View: Is MSG has any evidence to this effect, then he should provide the same to SIT which is probing black money.

MSG: Chandigarh has 15,000 acres and is a low rise, low density, wide spread city with a population of 11 lakhs (1.1 million). Naidu says with technology, he can plan a high-rise, high density city. In an administrative capital, there will not be more than 2, 3 lakh (200,000 to 300,000) people. Assuming there are 10 lakhs (1 million). I am okay with building an administrative capital when you have a new state, but who will go to the new city? Only the 25,000 to 30,000 government employees. Most of the families will stay back in Hyderabad itself because of the facilities available. Think of how long it took for Chandigarh to be a full-fledged city? 25 years.

Counter View: MSG simply ignores the fact that the proposed capital region falls right in between two of the well developed cities Vijayawada and Guntur. Both these cities have excellent outstanding educational, medical facilities and are also well established commercial hubs. Not to talk about excellent road, rail, air & water transportation facilities developed since British time. Guntur/Vijayawada also have high population density and expect a lot of population movement towards the new capital region, as the existing infrastructure like roads, sewage in these cities cannot be further developed. Vijayawada is 2x times densely populated as compared to New Delhi. Vijayawada+Guntur+Tenali+Mangalagiri has population density of new Delhi and 18% higher than Hyderabad. With the capital there will be lot more influx, and is there really an argument about being a full-fledged city.


This is a blog from Mr.Y V Rao