1239-Telangana's Here

 

Its a political decision,but the economic challenges of carving out a separate state are huge. 

With the UPA coalition partners and the Congress Working Committee having endorsed Telangana,its creation within the Indian Union is now a reality.Though the demand for Telangana dates back half a century,statehood had remained elusive till the fading electoral fortunes of the UPA changed political equations and made the idea more politically acceptable.By forming Telangana the UPA hopes to tap consequent goodwill and win a few more seats in the general elections next year.But the decision also raises serious political and economic challenges.
 

Politically there can be a backlash from proponents of a united Andhra Pradesh,unleashing turmoil.Claims regarding the exclusive status of Hyderabad will remain a flashpoint for many years.But the most important political repercussions will be in other states where regional aspirants have laid new claims for statehood for Gorkhaland, Bodoland, Vidharbha,Poorvanchal, Vindhya Pradesh and so on.
 

On the economic front the bifurcation of Andhra Pradesh can change the fortunes of a large state of 85 million people.One of the faster growing states in the country,Andhra Pradesh has successfully brought down poverty levels to 9.2%,which is less than half the national average.It has also emerged as one of the leading states in information technology, pharmaceuticals, health services and infrastructure.It is essential to ensure that a break-up would spur and not whittle down these achievements.
 

Smaller states are generally easier to administer,although this isn't a slam-dunk as the cases of Jharkhand or more recently Uttarakhand which caved in entirely to floods show.In certain cases larger states can mobilise more resources,as Andhra demonstrated by being the most successful among Indian states in tackling Maoism.

Whatever might be the long-term advantages of the division of Andhra, its clear that in the short term there will be many challenges.The additional funds for building social and physical infrastructure will burden the central government,adding to fiscal deficits which are already weighing down the economy.Business in coastal Andhra Pradesh will lose easy access to the large market in Hyderabad,while those in Telangana will be unable to easily access the large ports and tap the advantage of the huge gas reserves in Godavari basin.

The decision to create Telangana has been made on emotive and political grounds.But the devil lies in the details,which have been given short shrift.

(Times of India, 31:07:2013)

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