A.P. Cabinet panel favours hospitality model for Rushikonda building

The Andhra Pradesh government is moving closer to taking a final decision on the future utilisation of the controversial building constructed atop Rushikonda in Visakhapatnam during the chief ministerial tenure of YSRCP president Y.S. Jagan Mohan Reddy, with the Cabinet Sub-Committee favouring a hospitality-driven model that balances public utility and revenue generation. The Sub-Committee, comprising Finance Minister Payyavula Keshav and Tourism Minister Kandula Durgesh, held its third meeting at the Secretariat on Wednesday. Social Welfare Minister Dola Bala Veeranjaneya Swamy participated in the meeting in virtual mode. Senior officials from the Tourism Department, including Special Chief Secretary Ajay Jain, APTA CEO and and APTDC Managing Director Amrapali Kata briefed the committee on various proposals received so far and the regulatory aspects. Speaking after the meeting, the Ministers said that the building should be utilised in a manner that does not burden the State exchequer while generating steady income and serving public interests. Several hospitality majors, including Taj, Leela Palace, Atmos Core and FEMA, have reportedly expressed interest. However, the Ministers clarified that the existing structures are not entirely suitable for hotel operations and it may require additional construction. A major point of discussion was the Coastal Regulation Zone (CRZ) norms. Of the nine acres beneath Rushikonda Hill, construction is prohibited on seven acres, leaving only two acres available for permissible development. The panel deliberated on how best to utilise this land without violating environmental regulations. It was proposed that the last two blocks of the building complex be converted into an art gallery and spaces for cultural programmes. Mr. Keshav said that the Sub-Committee is scheduled to meet again in two days to explore more alternatives. The sub-committee decided to conduct a comprehensive survey of tourism lands and will discuss the proposals again in an online meeting with the Group of Ministers on December 28. The final recommendations will be presented to the State Cabinet for approval, with a clear preference for a viable hospitality model aligned with international beachfront standards. According to Mr. Durgesh, the Tourism Department lost annual revenues of ₹7 crore and now bears a monthly maintenance cost of ₹25 lakh. The Ministers criticised decisions taken by the YSRCP government, stating that the demolition of revenue-generating resorts and construction of the building resulted in heavy losses to the Tourism Department. Published - December 24, 2025 09:19 pm IST

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