Vijayawada: The authorities at Amaravati Metro Rail Corporation (AMRC) are hopeful that Vijayawada and Vizag metro rail projects will get sufficient funds from the Centre as they are externally aided projects. The Centre assured that 90 per cent of the externally aided projects' cost will be met by the Union government, under special package in lieu of special category status announced. German bank KfW had come forward extending a soft loan to develop Vijayawada metro that costs around Rs 6,000 crores.
This comes after several representations from the state government, including Chief Minister N. Chandrababu Naidu, asking the Centre to fund both the metro rail projects as per the provisions of AP Reorganisation Act were turned down by the Centre.
Union finance minister Arun Jaitley, in his letter dated 09.09.2016, while mentioning that the central government had already increased the share of state governments from 32% to 42% as per the recommendations of the 14th Finance Commission, added that it may not be possible for the central government to provide 100 pc funding for metro projects without any reference to the provisions of AP Reorganisation Act, 2014.
However, he reiterated that central government is fully committed to supporting the AP government and implementing the provisions of the AP Reorganisation Act, 2014.
The Centre also turned down the plea of exempting paying various taxes on Vijayawada metro which comes to around Rs 800 crore. The state sought tax exemption as part of Centre’s assurance of examining tax incentives in the AP Reorganisation Act.
“Now, we are happy to know that the Union finance minister once again announced in the Parliament that the Union government will implement the provisions of AP Reorganisation Act and the promises made for the economic development of AP. We hope that the metro rail projects in AP will get 100 pc central assistance or additional central assistance as per the special package announced by the GoI as these are externally aided projects,” said AMRC managing director N.P. Ramakrishna Reddy.
