Visakhapatnam-Chennai Industrial Corridor Development Program (Tranche 2) (ADB-48434-004)

  • South Asia
Geographic location where the impacts of the investment may be experienced.
  • India
Geographic location where the impacts of the investment may be experienced.
Specific Location
Vishakapatnam,Andhra Pradesh
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Apr 24, 2023
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
  • Industry and Trade
  • Transport
  • Water and Sanitation
The service or industry focus of the investment. A project can have several sectors.
Potential Rights Impacts
  • Healthy Environment
  • Housing & Property
  • Indigenous Peoples
  • Labor & Livelihood
  • Marginalized Groups
Only for projects receiving a detailed analysis, a broad category of human and environmental rights and frequently at-risk populations.
Investment Type(s)
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 141.12 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 214.80 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ ADB website

Updated in EWS May 19, 2023

Disclosed by Bank Apr 27, 2023

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to ADB, the proposed project is the second tranche of the multitranche financing facility (MFF) for Visakhapatnam-Chennai Industrial Corridor Development Program (VCICDP). With the comprehensive support through upstream strategic studies and regular programmatic interventions, tranche 2 will unlock the state's manufacturing potential through fostering industrial agglomeration with holistic infrastructure support, investment promotion, and skills development. The project will also strengthen climate and disaster resilience and integrate industrial and urban planning for more competitive and livable cities.

With investment support through projects 1 and 2 of MFF, the VCICDP will develop two industrial clusters in the Visakhapatnam node (Rambilli and Nakkapalli) and two clusters in the Srikalahasti-Chittoor node (Naidupeta and Chittoor-South).The spine of the VCIC aligns with the Bay of Bengal Highway, which connects Cox's Bazar to Thoothukudi and is a priority corridor identified in South Asia Subregional Economic Cooperation program.

ADB approved on 26 September 2016 a loan of $245 million for project 1 under the first tranche of the MFF available up to 30 June 2023. It aims to (i) develop internal and external infrastructure of industrial clusters, (ii) strengthen electric power distribution capacity to meet industry demand, (iii) widen a section of a state highway to improve connectivity from the national highway to a port, and (iv) improve the water distribution network in Visakhapatnam for 24/7 supply. On 8 February 2023, the Government of India submitted a periodic financing request for $141.12 million in the second MFF tranche for project 2, to enhance VCIC infrastructure, with a focus on prioritized industrial nodes in Visakhapatnam and the Srikalahasti–Chittoor.The Government of India also requested the extension of the MFF availability period from 30 June 2025 to 19 September 2026 to provide sufficient implementation period for the second tranche.

The Department of Industries and Commerc (DOIC) of Government of Andhra Pradesh is the executing agency of project 2, and Andhra Pradesh Industrial Infrastructure Corporation (APIIC)  and Andhra Pradesh Road Development Corporation (APRDC) are the implementing agencies.


People Affected By This Project
People Affected By This Project refers to the communities of people likely to be affected positively or negatively by a project.

Land Acquisition and Involuntary Resettlement Impacts of the various subprojects:

1. Start Up Area of Rambili Industrial Cluster

  • Land requirement of 396.27 acres is spread across two villages neamley Krishnampalem (337.49 acres) and Gorapudi (58.78 acres). 379.36 acrees have already been handed over to Andhra Pradesh Industrial Infrastructure Corporation (APIIC) and 16.91 acres remain to be acquired and handed over.
  • The subproject will impact 63 families (173 persons based on available land records and primary surveys) who will face loss of agricultural land. 24 percent of affected families (15) are belonging to vulnerable category belonging to Schedule Caste and Other Backward Communities and will require additionl assistance by the project. 5 of these families are also Women headed.

2. Start Up Area of Chittoor- South Industrial Cluster

  • The subproject will involve acquisition of private land and resumption of assigned land for the proposed infrastructure improvements. The project start-up area of 2627.65 acres will involve acquisition of 161.03 acres (65.17 hectares) of private land and resumption of 1494.70 acres (604.9 hectares) of assigned land2 . Further, the subproject involves 971.92 acres (393.33 hectares) of government land of which 572.61 acres (231.73 hectares) will be transferred to the subproject while an area of 399.31 acres (161.6 hectares) of government land which is part of this subproject layout, being village site, road/ cart track, stream/ kaluva (canal) / TGP Canal, tank and quarries, will be maintained without altering its status. The subproject land requirement (as per the layout) totals about 2627.65 acres (1063.39 hectares). This subproject involves involuntary resettlement impacts to 874 families, all of whom will be significantly impacted.
  • The subproject will cause impact to 138 tribal families from whom assigned government land (222.56 acres/90.06 hectares) is being resumed. The tribal people belong to Yanadhi tribe, and this affected tribal community does not belong to the Particularly Vulnerable Tribal Group (PVTGs) of the State. The affected tribal families will lose government land assigned to them and will face significant economic (involuntary resettlement) impact.

3. Road for External Connectivity to Naidupeta Industrial Cluster Road Subproject

  • The subproject requires 68.10 acres of land (27.56 hectare) comprising 46.47 acres of private land (18.80 hectare) to be acquired and 13.16 acres of DKT/assigned land (5.33 hectare) and 8.47 acres (3.43 hectare) of government land. The acquisition of private land will be through the provisions of RFCTLARR Act 2013 and resumption of assigned land will be carried out under the provisions of The Andhra Pradesh Assigned Lands (Prohibition of Transfers) Act, 1977.
  • The acquisition of 46.47 acres of private land and resumption of 13.16 acres of DKT/assigned land will impact 248 landowners/ assigned land holders. Out of the 248 affected families, 145 are private landowners and 103 families are DKT/assigned land users.
  • Out of the total 248 affected families, 220 will be losing agricultural land, 17 will face impact on residential structure, 5 families will be face impact on commercial structure, 1 family will face impact on residential cum commercial structure and 5 families will be impacted due to loss of secondary structures/subsidiary structures like compound wall, cattle shed etc. Out of the 248 affected families, 62 families will experience significant impact on land and 20 families will experience significant impact on structures.
  • Further, the subproject will cause impact to 7 common property resources including 2 temples and 2 schools. In all the subproject will affect landowners of 46.47 acres agricultural land (145 families), 103 DKT/assigned land users, 28 structures, and 7 common property resources.

4.Road For External Connectivity to Nakkapali Industrial Cluster Road

  • As per Land Plan Schedule (LPS), the subproject involves acquisition/ transfer/ alienation of land measuring 44.071 acres (private land acquisition is 23.75 acres and government land is 20.32 acres. The acquisition of private land will be through the provisions of RFCTLARR Act 2013.
  • All affected private land parcels are in agricultural use except for one land parcel on which a temple is built.
  • As per census and socioeconomic survey, sub project will impact on 190 households that include 189 agricultural landowners and 1 person employed as a temple priest.
  • Project impact to all affected landowners will be limited to economic displacement (due to loss of agricultural land). Subproject is not anticipated to result in physical displacement.

5. Start-Up Area of Nakkapalli Industrial Cluster

  • Land acquisition for the industrial cluster (which includes the designated start-up area as well) was initiated in 2010-2011 and , 962.03 acres of land was already acquired and handed over to the subproject. Resettlement plan was prepared for 174.44 acres (out of 1120 acres). The plan accordingly covers 34.72 acres of private land parcels involving negotiated/direct purchase and 139.72 acres of government/assigned land for which acquisition/resumption of land remains incomplete.
  • The subproject has been planned in such a way that a green buffer of 50 meters will be left around the boundaries of existing settlements. Mulapara and Tammayapeta settlements that exist on grama kantams (government land) and Patimida settlement within the start-up area (measuring 29.93 acres) will be retained.
  • The subproject involves impact to 203 families (914 persons, based on available land records, and sample primary surveys) which includes (63) families affected by loss of land and (140) non-titleholder families impacted by partial loss of structures/minor structure loss, of which 116 face temporary income loss due to laying of pipelines under bulk water supply component.
  • Impacts include loss of private agricultural land to 40 families (affected by negotiated/direct purchase) and loss of assigned/government land to 23 families and partial structure/asset loss to 140 families (all non-titleholders) due to proposed Bulk Water Supply works.
  • No physical displacement is anticipated by the subproject. However, economic displacement is anticipated to 139 families of which 23 families (assigned land holders and encroachers on assigned/government land) face permanent economic impacts and another 116 families face temporary income loss due to partial loss of structure or access disruption by the bulk water supply works.
  • None among the affected persons belong to scheduled tribe community. About 29% of the entire affected families are estimated to belong to vulnerable category and will require additional assistance by the subproject.  

6. Road for External Connectivity to Rothusurumala Cluster

  • The land requirement of the subproject is 87.30 acres, out of which 56.01 acres (40.14 acres in Routhusuramala and 15.865 acres in Kothapalem villages) is being allocated from the land originally acquired for the subproject -start-up area of Chittoor South Cluster of Srikalahasthi Node.
  • This resettlement plan accordingly covers for impacts related to acquisition/transfer/ resumption for balance land requirement of 31.30 acres (comprises private land measuring 13.37 acres, assigned land measuring 8.52 acres and transfer of 9.41 acres government land). The subproject road passes through 6 villages. The acquisition of private land will be carried out as per the provisions of RFCTLARR Act 2013 while resumption of assigned land will be carried out under the provisions of The Andhra Pradesh Assigned Lands (Prohibition of Transfers) Act, 1977.
  • Land acquisition under this subproject will result in impact to 39 households which includes 38 households from titleholder category and 1 non-titleholder household. None among the affected households belong to scheduled tribe. Affected households will face displacement either due to loss of agriculture land or loss of residence or income generating assets (such as shops) or both. As per census survey, 2 households will face both physical and economic displacement due to loss of residence cum commercial structures while 33 households will face only economic displacement (30 households due to loss of agriculture land and 3 households due to impact to commercial structures/business). 4 other affected households will face minor loss of private structures not leading to economic or physical displacement.

7. Widening of Anakapalli to Atchuthapuram Road

  • The subproject will involve acquisition of private land measuring 21.57 2 acres, will require government land measuring 1.52 acres.
  • It will impact 1133 families (9883 titleholders and 1454 non-titled affected families). This will lead to loss of agricultural land to 501 families, loss of residence to 189 families, loss of business to 203 families, loss of residence and business to 42 families, loss of kiosk to 30 families, loss of other structures such as compound wall, etc., being non-significant impact, to 73 families and will impact 95 tenants.
  • The estimated number of vulnerable households is 550. In addition, the subproject will impact 59 common property resources. 



Investment Description
Here you can find a list of individual development financial institutions that finance the project.

The Government of India submitted a request for a loan of $141.12 million from ADB’s ordinary capital resources to help finance the project. The loan will have a 26-year term, including a grace period of 5 years, an annual interest rate determined in accordance with the ADB’s Flexible Loan Product, a commitment charge of 0.15% per year; and such other terms and conditions set forth in the loan and project agreements. Based on the straight-line method, the average maturity is 15.75 years, and the maturity premium payable to ADB is 0.10% per year.

The loan from ADB will finance: (i) civil works, (ii) consulting services and skill development, and (iii) the part of incremental administrative costs. The GoAP will contribute $73.68 million equivalent to cover: (i) taxes and duties, (ii) land acquisition and resettlement, (iii) part of incremental administrative costs, (iv) contingencies, and (v) financing charges.

Climate adaptation is estimated to cost $51.77 million, of which ADB will finance $44.17 million (85%) and the government $7.60 million (15%). Climate mitigation is estimated to cost $0.34 million, of which ADB will finance $0.29 million (85%) and the government $0.05 million (15%).

Contact Information
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Responsible ADB Officer Matsunaga, Akira
Responsible ADB Department South Asia Department
Responsible ADB Division Urban Development and Water Division, SARD
Executing Agencies
Department of Industries & Commerce, Government of Andhra Pradesh


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