Demand in RS for viability gap funding for Andhra Pradesh’s Kakinada petrochemical project

A demand to provide viability gap funding for a petrochemical project at Kakinada in Andhra Pradesh was made in Rajya Sabha on Monday. Raising the issue through a Zero Hour mention, K V P Ramachandra Rao of the Congress said a petrochemical project was promised as part of the Andhra Pradesh Reorganisation Act. The government of Andhra Pradesh, Hindustan Petroleum Corp Ltd (HPCL) and gas utility GAIL India Ltd had signed a MoU to do a feasibility study, he said, adding the cost of the project came to Rs 32,901 crore.

“However, PSUs are of the opinion that viability gap funding is needed for the project,” he said, adding the Union Ministry of Petroleum and Natural Gas has stated that the state government should provide capital from its own resources. He said Andhra Pradesh lost is financial base after its bifurcation and has become a revenue deficit state.