US-based consultancy firm Boston Consultancy Group (BCG), which submitted its report to Andhra Pradesh chief minister Y S Jagan Mohan Reddy on Friday evening, categorically ruled out the location of capital city at Amaravati, saying it is not fit for the construction of the capital city.
Quoting technical studies conducted by IIT Madras and AP Disaster Management Authority, the BCG said the area up to five km from the Krishna river front is highly prone to flooding and inundation and is not recommended for construction of the capital city.
The BCG further said the success ratio for economic development was very low in the greenfield capital city like Amaravati in the absence of a compelling economic starting point like Shenzen (Hong Kong) and Navi Mumbai (Mumbai city).
“Such green field cities require significant investment, have long gestation period and require sustained efforts. It takes more than 40 years for the development if Rs 1 lakh crore would be spent for Amaravati construction. About Rs 8,000 to Rs 10,000 crore would be spent on only debt services for the capital city construction,” the report said.
The BCG report said instead of the capital city, Amaravati could be developed as an education hub, food and fisheries hub and hi-tech organic agriculture hub.
“Focused efforts on these clusters to ensure employment creation and faster development,” the report said.