2 weeks ago
Vizag-Chennai Industrial Corridor faces delays as ADB deadline nears
The government of a big state in India is building a very long road and industrial area called the Vizag-Chennai Industrial Corridor.
It runs for 800 kilometres and is meant to connect cities and help businesses grow.
A bank called the Asian Development Bank, or ADB, agreed to pay 70 percent of the cost.
The state government promised to pay the other 30 percent.
They planned to finish the work by September 2026.
But the work has been slow because of the Covid-19 pandemic and other problems.
If the work is not finished by the deadline, the state will have to pay 50 percent instead of 30 percent.
That would cost the state more than 500 crore rupees extra.
Officials are now trying to speed up the work and have asked the central government and the ADB for help.
If the corridor is finished, officials say it could attract huge investments and create more than 50,000 jobs.
The Vizag-Chennai Industrial Corridor risks missing the Asian Development Bank's September 2026 completion deadline, which would raise the state government's share of project cost from 30 percent to 50 percent.
Missing the deadline would impose an additional burden of more than Rs 500 crore on the state government.
The 800-km corridor, launched in 2016 at an estimated cost of Rs 2,850 crore, saw its packages reduced from 12 to seven and the cost revised to Rs 1,630 crore after a 2022 review.
A 2024 review found first-phase packages had recorded about 50 percent progress and second-phase packages about 30 percent progress, with around Rs 160 crore in pending bills at the time.
The southern stretch around Naidupeta in the Rayalaseema region has progressed better, while road connectivity works are about 70 percent complete and works near Visakhapatnam are 40-50 percent complete.
- Who
- The Andhra Pradesh state government and the Asian Development Bank (ADB), along with contractors working on the corridor.
- What
- The Vizag-Chennai Industrial Corridor risks missing the ADB's September 2026 completion deadline, which would raise the state government's contribution from 30 percent to 50 percent and add a burden of more than Rs 500 crore.
- Where
- Andhra Pradesh, India, along the 800-km corridor between Visakhapatnam and Chennai, including the Rayalaseema region, Naidupeta and Chittoor.
- When
- September 2026 (ADB deadline); the project began in 2016, with reviews in 2022 and 2024.
- Why
- Delays caused by the Covid-19 pandemic, the reverse tendering policy of the previous government, tender-related issues and increased construction costs.
Key facts
- Project
- Vizag-Chennai Industrial Corridor
- Length
- 800 km
- Initial estimated cost
- Rs 2,850 crore
- Revised estimated cost (2022)
- Rs 1,630 crore
- ADB loan share
- 70 percent
- State government share
- 30 percent (would rise to 50 percent if deadline is missed)
- Completion deadline
- September 2026
- Extra burden if deadline missed
- More than Rs 500 crore
Sources
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