BCG report suggests choosing Visakhapatnam over Amaravati as capital

Boston Consulting Group (BCG), a US-based global consulting firm, has recommended that the entire Andhra Pradesh state administration be shifted from Amaravati to Visakhapatnam in its elaborate report on the capital that was submitted on Friday.

The BCG submitted its report to Andhra Pradesh Chief Minister YS Jagan Mohan Reddy at the Secretariat during the evening hours of Friday. A six-member expert committee, headed by retired IAS officer G N Rao made similar recommendations previously. The G N Rao committee’s report was submitted to the State government on December 21, 2019.

Last week, the State government appointed another committee consisting of 16 high-level officers to go through both the GN Rao panel report and the BCG report. January 20, 2020, has been set as the deadline for making its recommendations after analysing both the reports.

Planning department secretary G S Vijay Kumar said Boston Consulting Group recommended that the Raj Bhavan, state secretariat and Chief Minister’s office be set up in Visakhapatnam, which can be chosen as the State capital. He added that the assembly could be either in Vijayawada or Amaravati and the high court may be shifted to Kurnool.

It was revealed that the BCG had suggested decentralising the capital, ensuring the development of all regions in Andhra Pradesh through a balanced and inclusive growth strategy. The report divided the 13 districts into six regions, based on the natural resources and growth potential. It also took into consideration the agriculture, industry, economy, infrastructure, services, and other social infrastructure aspects.

Analysing the potential of Amaravati as the state capital, the BCG report deemed that a the success ratio for economic development was very low in the greenfield capital city. The report predicted that if made the capital, the Amaravati project would take more than 40 years with an investment of Rs 1 lakh crore for construction alone. The report further added that around Rs 8,000 to Rs 10,000 crore would be the expenditure on only debt services for the capital city construction.

The BCG report also elaborated that since Amaravati was not suitable for the construction of a capital city owing to the proximity to the Krishna riverfront. The five-kilometre range suggests that the city may be prone to inundation and flooding. The report suggested that alternatively, the city could be developed into education, food, and fisheries or a hi-tech organic agriculture hub. The report said an added focus on these sectors would ensure employment creation and faster development.