The Telugu Desam Party-led coalition government in Andhra Pradesh, headed by Chief Minister N Chandrababu Naidu, has stirred considerable buzz across the state with its decision to extend benefits and incentives to the well-known real estate giant Lulu Group, led by M A Yusuff Ali.
From the outset, Naidu has followed a consistent model: allocate government land to corporate entities at concessional rates, offer them attractive incentives, earn praise as a visionary leader, and bolster his image in business circles. This has become a hallmark of his governance style.
Political analysts argue that allocating land for a private shopping mall doesn't amount to a significant investment milestone — especially in a city like Vijayawada, which already houses several malls. Yet, the Chief Minister has shown particular interest in Lulu Group by deciding to allot prime RTC depot land in Vijayawada for the construction of a new mall.
According to a government order issued on Sunday, the state has allocated 4.15 acres of valuable RTC land, located in the heart of Vijayawada, to Lulu International Shopping Malls Pvt. Ltd. (LISML).
The Revenue Department and District Collector have been directed to identify and allocate alternate land to the RTC in compensation. The land allotment falls under the newly introduced Andhra Pradesh Tourism Land Allotment Policy 2024–2029.
This isn’t the first time the government has extended such benefits to Lulu Group. Previously, 13.74 acres of land in Visakhapatnam were allotted to the company at a nominal rate.
In both cases, the land is being leased for 99 years — despite being worth hundreds of crores of rupees.
Even more notably, Lulu Group has been granted a three-year construction period during which no lease payment is required. The lease will only commence once commercial operations begin — an extraordinary concession by the state.
Critics point out that the land value far exceeds Lulu’s proposed investment. The company plans to build a shopping mall spanning 2.32 lakh sq. ft. at a cost of ₹156 crore.
Officials admit that once the 99-year lease is finalized, the company could mortgage the land to raise loans for project execution.
Given Lulu Group’s strong brand and business credibility, acquiring such loans is expected to be straightforward.
Detractors argue this is a textbook example of Naidu’s corporate-friendly governance model — where public assets are leveraged heavily to favor private interests.
