Making a statement in the Legislative Assembly amid a din caused by opposition YSR Congress, Naidu said, "The Cabinet met on September 1 and resolved to locate the capital city in a central place of the state, around Vijayawada, and go for decentralised development of the state with three mega cities and 14 smart cities.
"It is proposed to go for land pooling system to be worked out by a Cabinet sub-committee," he said.
"This decision of the Cabinet is a reflection of the popular sentiment, and is affirmed by views expressed in the representations received by the Sivaramakrishnan Committee (appointed by the Centre)," he said.
"Nearly 50 per cent of the representations received by the Committee favoured Vijayawada-Guntur region as the best location for the capital area," Chandrababu said.
The state government, as resolved by the Cabinet, was of the opinion that the interests of the entire state and its balanced development could be best served by locating the capital city at a central place around Vijayawada.
This would enable equal access to people from all regions of the state, he observed.
Before Naidu made a statement on the issue, adamant MLAs of YSR Congress stalled the proceedings demanding that the House first discuss the Sivaramakrishnan Committee report on location of new state capital.
The House had to be adjourned twice for 15 and 10 minutes respectively as the Opposition legislators remained in the Well, holding placards and raising slogans for a discussion on the subject.
Though Speaker Kodela Sivaprasada Rao, Legislative Affairs Minister Yanamala Ramakrishnudu, other ministers and TDP MLAs found fault with the YSRC's conduct, the opposition members remained adamant on their demand.
"You can't dictate terms to the House. It runs as per rules and procedures. You can take part in the discussion and express your views," the Speaker told the agitating members but to no avail.
Reacting to Leader of Opposition Y S Jaganmohan Reddy's remark that there appears to be "no democracy" in the House, the Legislative Affairs Minister shot back saying "there is democracy but no Jaganocracy".
"This is not Lotus Pond or Idupulapaya (Jagan's family estates). This House is Assembly. It runs according to rules and traditions. You should follow them," Yanamala told Jagan.
Ministers Bojjala Gopalakrishna Reddy, K Atchannaidu, Chief Whip Kalva Srinivasulu, senior MLA Gorantla Butchaiah Chowdary and others also came down heavily on Jagan and his party colleagues.
"It is for the popularly elected government to decide where the capital should be located in the interests of the state. It can't be located where you and your associates have purchased huge tracts of land," the TDP members said.
But with the YSRC members in no mood to let the House run, the Speaker adjourned it twice, first for 15 minutes and later for 10 minutes.