The Government of Andhra Pradesh recently told Hyderabad High Court that it never intended to exclude Indian companies from participating in the tender process for the construction of Amaravati Capital City, but insisted on firms having international experience only to invite the more competent companies. Defending the tender norms which were challenged by two real estate firms, AP’s advocate general Dammalapati Srinivas told a bench of Acting Chief Justice Ramesh Ranganathan and Justice U Durga Prasad Rao that two or three firms could form a consortium, with one of them being a foreign firm. “This way even Indian firms can tie up and file a challenging bid under Swiss Challenge method under which a ‘master developer’ would be selected,” the AG said.
One such Consortium from Singapore which is the original proponent of the project, has a net worth of Rs 60,000 crore and a varied experience of building large facilities in Chennai, Bangalore, and China etc, Srinivas said. “If our intention was to eliminate Indian firms, we would have put the condition that bidding firms must have a net worth of Rs 60,000 crore. We did not do that,” the AG said. Adding on that since the Capital construction project was just worth Rs 3,100 crore, the government only insisted that the firms must have a net worth of Rs 2,000 crore, Srinivas said. To a query whether Capital construction meant building of a whole new city, the AG said that for now the plan was to get a start-up Capital constructed, which would itself trigger growth in the entire capital city area.
He also said that there are going to be three phases of construction in the start-up area of the Capital. The Singapore Consortium was planning to construct the first phase, and upon selling 70 per cent of the developed plots to various commercial enterprises, it would begin the second phase of construction, and so forth. This strategy was crucial for development, Srinivas said citing the example of 3 lakh square feet space developed jointly by APIIC and L&T near Gannavaram in Krishna district being unused. Mere ability to construct was not sufficient. It should be accompanied by adequate and commensurate marketing skills and the capabilities of the Singapore Consortium with their skills were verified, he said.