Telangana- An economic powerhouse in India

The last week of 2010 has been nerve-wracking about the outcome of the SriKrishna Committee report. The committee, strangely has finished its work on time and has submitted the report a day earlier than the deadline.

Regardless the outcome, the demand for placing a bill in the parliament in the Budget session is growing everyday. It is reported that both the UPA chairperson Mrs.Sonia Gandhi and the Prime Minister, Mr.Manmohan Singh are contemplating the numbers game in case Telangana is formed. Being politically motivated, one can understand their concern. But as heads of a fast growing nation, their fear seems unwarranted. India, as known is a major superpower in the world and the recent trips to India by the heads of the five most powerful countries of US, China, Russia, France and UK only attest to the fact. The Indian economy has been growing at 8% over the few years and is expected to touch 9% this year onwards. That is a great achievement considering the economy of most industrialized countries is in doldrums. Every state in India plays a part in the growth.

The present state of Andhra Pradesh, though claims to be a developed state, actually lags behind in many indicators on national level. Literacy, Infant mortality, Child Marriage are some of the things that Andhra Pradesh lags behind in. These affect the economy in a big way. Since KCR’s fast in November 2009, the government in AP has been ruing the fact that there are no investments in Andhra Pradesh. This is entirely untrue. There have been massive investments in the coastal regions for a glass factory, as well as a new tobacco plant in Guntur. The partiality in attracting the investments to Non-Telangana regions can be seen clearly. The only worth while investment in Telangana is the Hyderabad Metro, which at Rs. 12700 crores is a dud in the making and will be highly loss-oriented.(I’d write up another article on this). Now the question arises as to how Telangana, when formed can be beneficial to Indian economy.

There have been misinformed notions that since Telangana is land locked country, and has no ports Telangana cannot develop. Apart from this the, dry barren land does not evoke positive responses from agriculturists. But then many forget that the rightful share of Telangana waters are diverted to coastal andhra and rayalaseema. The people here have to depend on tubewells, borewells for the available scanty water. Somehow in spite of this Telangana sustains agriculture and Karimnagar, Warangal rank amongst the top agricultural districts in the state. If we get our share of water, we can only imagine the extent of agriculture in this region. In terms of agriculture, Telangana has a great scope for development. As always, a state which is agriculturally developed, grows economically as well.

Industrialization is another thing that drives an economy. Along with agriculture, industries are also the important factor of economy. Prior to the merger with Andhra, there was no dearth of industrialization in Telangana. We could boast of housing Asia largest sugar factory amongst others. The condition of the industries which grew under the patronage of Nizam, is now in dire straits. Some have been sold out, while some await similar fate. There is a scope to bring these industries back online and provide jobs. There is a talk of a wagon building work shop in Kazipet in Warangal district. At the present rate one can expect the jobs to be taken over by seema-andhra candidates. But in Telangana, that will not be the case.

The present population of Telangana constitutes of over 60% as under 20 years. So that is a lot of work force. Sadly, due to loss of their jobs to illegal immigrants, many prefer to work at other places for a substandard living. As has been told before, a separate state of Telangana is a remedy for this. Apart from this, increased work force also increases the standard living, which means higher taxable income and higher tax revenues, which ultimately results in higher state income. Since the tax revenues is part of the state expenditure, we get to enjoy what we pay for, unlike now, where the state budget is diverted of to non-telangana regions. In addition to this there is a budget allocation from the central government. Contrary to the popular belief, it is not the size of the state that decides that share of the allocation, it is the state’s contribution towards the central pool. for example, Mumbai being a city has a larger budget than Haryana, because and a larger central government allocation, because it contributes nearly 23 % of India’s income. Similarly Telangana’s increased economy will only help the central governments allocation.

Hyderabad, in the heart of Telangana, is a major city in India. Again repeated claims of its development by the government of AP is not exactly correct. Apart from being a major IT destination, Hyderabad has a lot to claim. Even in terms of IT exports, it occupies third position in India behind Bengaluru and Chennai. Along with these two cities, Hyderabad is part of the Golden triangle of IT. Pune is now breathing down on Hyderabad for the third position. Apart from making it a concrete jungle and paying no heed to its history, the Andhrites have only damaged the city rather than their claims of developing it. Sadly, today this city is known more for its scams, drug cases and murders than the good ones.

As the capital of Telangana, Hyderabad has the opportunity not only to develop itself, but also its neighbouring areas. The major towns, (Warangal, Karminagar, Nizamabad, Tandur, Mahbubnagar, Nalgonda etc) which are also district headquarters are about 100 kms to 150 kms or just over two hours away from Hyderabad. No other capital city in India can boast of this sort of congregation. Any investment can be spread around these areas, creating jobs in new avenues. This will also mean that there won’t be an additional strain on the capital city. These cities are all wonderfully interconnected by a good network of roads. Apart from this Hyderabad is about 700 kms away from Mumbai, Chennai and Bangalore. With this sort of geographical connectivity, Hyderabad has a great chance for development.

It all comes down to good governance and people’s ability to bring the best out the government. This is an example i always mention when i talk about people’s pressure on Government. In the year 2006, the Indian railways decided to change the colour of many station buildings around India. In chennai, the station building which was brick red in colour was changed to a light shade of brown. The people, who treat the building as an icon, did not approve of this and pressurised the board and the government to revert the station back to its old colours. A similar thing was done with Secunderabad railway station where its colour was changed to blue from its earliest brick red. But there were hardly any repercussions. Nobody cared. This sort of attitude should not be practiced in democracy and in Telangana we need to bring the government to books to fulfill its obligations.

These are some of the perfect ingredients for a great Telangana economy. A great state is good for a burgeoning economy. As of now Andhra Pradesh is paralysed and it is an hurdle in the growth of India.

Our Prime Minister, being a noted economist, should be aware of this.