Another major expenditure controversy has surfaced in the construction of the Amaravati capital. Questions are being raised over the cost of quarters being built for MLAs and IAS officers.
According to figures cited from the Comptroller and Auditor General (CAG) findings, 72% of the project was completed at a cost of ₹363.68 crore, while the estimated cost for the remaining 28% of the work was later raised to ₹524.70 crore.
The key question is: How did the estimated cost of the remaining work increase from ₹272.22 crore to ₹524.70 crore? The alleged increase amounts to an additional burden of ₹252.48 crore.
18 Towers, 432 Flats and an Initial Estimate of ₹635.90 Crore
The Amaravati project envisaged the construction of 18 towers with 432 flats for MLAs and IAS officers. The work was awarded to NCC in 2017, with an estimated project cost of ₹635.90 crore.
By 2019, around 72% of the work had reportedly been completed, with expenditure of ₹363.68 crore, according to the figures cited from the CAG observations.
At that stage, the estimated cost of completing the remaining 28% of the project was reportedly ₹272.22 crore.
This is where questions over the project cost begin.
Remaining 28% Work Estimated at ₹272.22 Crore
When 72% of the construction had been completed, the estimated expenditure required for the remaining 28% was reportedly fixed at ₹272.22 crore.
In other words, most of the project had already been completed, while less than one-third of the work remained.
However, the estimate was subsequently revised substantially upward.
How Did ₹272.22 Crore Become ₹524.70 Crore?
The estimated cost of the remaining work was allegedly increased from ₹272.22 crore to ₹524.70 crore.
That represents an increase of ₹252.48 crore over the earlier estimate.
The numbers raise an obvious question: Why would the cost of the remaining 28% of the work be estimated at ₹524.70 crore when 72% of the project had been completed for ₹363.68 crore?
The comparison is striking:
- 72% of the work: ₹363.68 crore
- Remaining 28%: ₹524.70 crore
Critics are now demanding an explanation for the sharp escalation in the estimated cost.
If Material Prices Did Not Rise Significantly, Why Did the Estimate Increase?
Construction costs can normally rise because of increases in the prices of steel, cement and other materials, higher labour costs, design modifications or additional works.
However, the issues cited in connection with this project reportedly indicate that there was no significant variation in the prices of steel, cement and other construction materials, while sand was also available free of cost.
This raises another important question:
If construction material prices did not witness a major increase and there was no additional expenditure on sand, what caused the estimated cost of the remaining work to rise from ₹272.22 crore to ₹524.70 crore?
The government would need to provide details of any additional works, design changes or other factors responsible for the revision.
Were the Remaining Works Awarded Without Administrative Approval?
Another issue attracting attention is the allegation that the remaining works were handed over to NCC without the necessary administrative approval corresponding to the revised estimate.
Given the scale of the expenditure, questions arise over the approval process.
What authority approved the revised estimate? When was administrative approval granted? What was the basis for increasing the value of the remaining works? Under which provisions was the additional amount allocated to the contractor?
Clear answers to these questions are necessary to establish how the revised project cost was determined.
The Key Figures at a Glance
The major figures associated with the project can be summarised as follows:
- Original project estimate: ₹635.90 crore
- Number of towers: 18
- Number of flats: 432
- Work completed by 2019: 72%
- Expenditure on completed work: ₹363.68 crore
- Remaining work: 28%
- Initial estimate for remaining work: ₹272.22 crore
- Revised estimate: ₹524.70 crore
- Increase in estimate: ₹252.48 crore
Therefore, the central issue is not merely whether the project cost increased. The larger questions are why it increased, on what basis it was increased and who authorised the increase.
72% Work Cost ₹363.68 Crore, Remaining 28% Estimated at ₹524.70 Crore
Politically, the figures have become a major point of criticism against the government.
When 72% of a project was completed at a cost of ₹363.68 crore, the fact that the estimated cost of the remaining 28% subsequently reached ₹524.70 crore naturally invites scrutiny.
The fact that the initial estimate for the remaining work was ₹272.22 crore makes the issue even more significant.
Several questions therefore require clarification:
- What additional works were introduced?
- Did the scope of the project change?
- Were there any design modifications?
- How much did material and labour costs actually increase?
- What was the basis for the additional ₹252.48 crore?
- Who approved the revised estimate?
- Was the revised administrative approval obtained before awarding the additional work?
Transparency Needed in Amaravati Capital Projects
Every project undertaken in the name of Amaravati involves substantial public expenditure. Therefore, transparency in cost estimates, revisions and contractual changes is essential.
The government has the relevant project records, estimates, approvals and contract documents. Making these details public could help address the questions surrounding the cost escalation.
In particular, the ₹252.48 crore difference between the original and revised estimates for the remaining work has become the central issue.
If additional works or legitimate cost factors justified the revision, those details need to be placed in the public domain.
What Is the Real Story Behind the ₹252.48 Crore Increase?
The Amaravati MLA and IAS quarters project began with an estimated cost of ₹635.90 crore.
By 2019:
72% of the work had reportedly been completed at a cost of ₹363.68 crore.
The remaining 28% was initially estimated at:
₹272.22 crore.
That estimate was subsequently revised to:
₹524.70 crore.
The resulting difference is:
₹252.48 crore.
The central issue, therefore, is straightforward: What exactly caused the ₹252.48 crore increase in the estimated cost of the remaining work?
The government’s explanation, along with details of the revised estimates, administrative approvals, additional works and contractual changes, would be crucial to resolving the controversy.
At a time when large-scale construction is once again being undertaken in Amaravati, every rupee of public money needs a clear justification, every estimate needs a transparent basis, and every cost escalation needs to be properly accounted for.
