Lulu Mall in Vijayawada: Andhra govt cancels land allotment amid controversy

The Andhra Pradesh government has withdrawn its decision to allot a prime piece of land belonging to the Andhra Pradesh State Road Transport Corporation (APSRTC) in Vijayawada to the Lulu Group.

While the Andhra Pradesh High Court was hearing a petition filed by former minister Vadde Shobhanadreeswara Rao challenging the land allotment, Advocate General Dammalapati Srinivas informed the court on Thursday (April 9) that the government had cancelled the allotment and would take back the land. Political circles describe this as a U-turn taken amid public pressure, political criticism, and protests by various organisations.

When and how was the land allotted?

Through a Government Order (G.O.) No. 137 issued on July 5, 2025, the government allotted 4.15 acres of prime land in Governorpet, Vijayawada—located near the RTC old bus stand and depots—to Lulu International Shopping Malls Private Limited on a 99-year lease. The terms stated that the company would pay a nominal rent of Rs 1.50 per square foot, with the first three years being rent-free. The Lulu Group had proposed to build a shopping mall on the site with an investment of Rs 1,222 crore.

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According to RTC employee unions and opposition parties, the market value of this land in the capital region is around Rs 400 crore (approximately Rs 96 crore per acre). However, the government leased it out at what critics called a “throwaway price.” It is important to note that this was not a sale, but a long-term lease of 99 years.

What triggered the criticism?

As soon as the allotment came to light, strong opposition emerged from RTC employee unions, CPM, CPI, YSRCP, and traders’ associations. YSRCP and civil society groups even termed it a “scam.”

Initially, the government justified the move as being in the interest of tourism, investment, and urban development. It argued that large-scale malls by the Lulu Group would boost employment and commercial activity in the state. The State Investment Promotion Board had also approved the proposal.

Various sections point to sustained protests, warnings from RTC unions, agitation by CPM, and multiple PILs—including the petition filed by Shobhanadreeswara Rao—as key reasons. Internal pressure within the ruling alliance, including from Jana Sena chief Pawan Kalyan, also played a role.

Realising that it would be difficult to proceed amid ongoing court scrutiny, the government chose to step back. Through the Advocate General, it announced the cancellation, effectively closing the case. Formal cancellation orders are expected to be issued soon.

‘Victory for the people’

CPM state executive member CH Baburao said that their agitation against leasing out land worth hundreds of crores—located in the heart of Vijayawada and belonging to the working class—to the Lulu company has succeeded.

Speaking to The Federal Andhra Pradesh, he criticised the Chandrababu Naidu-led government, alleging that it has been committing several such “wrongdoings” by acquiring land worth lakhs of crores in the name of industrial development and turning into an exploitative regime. He described the government’s decision to cancel the lease allotted to the Lulu company as a “victory for the people”.

(This article was originally published in The Federal Andhra Pradesh)