Calcutta Notebook


Major Andhra Politicians are in a dilemma on splitting of the State. Chandrababu Naidu of Telgu Desam had supported splitting of the State previously. Now he has developed cold feet on the issue. YSR Congress had mainly kept mum on the issue. Now it has come out in the open against the move. The turnaround seems to be driven by the personal interests of these politicians. Both these families hail from Seemandhra. It has now dawned upon them that they would lose the opportunity to rule over the larger state after the split. Their writ will become smaller hence they have now changed their tune even though the split is likely to be beneficial for Seemandhra and not so good for Telengana.

Telengana is poor; and Seemandhra rich in natural resources. Seemandhra has a long coastline with many seaports. It has a large irrigated area. There are many power plants in Nellore. In comparison Telengana is land locked and largely has a desolate countryside. However, the resources of the State have mostly been invested in the last two decades in the capital city of Hyderabad which is located in Telengana. The city had been transformed by excellent roads, economic zones, airport and so on while the countryside remained neglected. The IT sector is wholly concentrated in Hyderabad. Nearly one-half of all state revenues are earned from this city. The State that gets Hyderabad turns out ahead, immediately, at least.

Seemandhra will always remain the hinterland in united Andhra Pradesh. Actually the revenues generated from Seemandhra have helped build Hyderabad. Stand alone Telengana could never make the huge investments in Hyderabad. Seemandhra has the capacity to build not one but four Hyderabads; while it may be difficult for Telengana to even sustain the present glory of Hyderabad.

Seemandhra should take a lesson from Haryana. Haryana was the 'backward' part of the United Punjab at the time of splitting. Major industrial centers of the united Punjab like Ludhiana and Jalandhar; and the pilgrim and trade center of Amritsar and the crossover point with Pakistan at Wagah—all went to Punjab. But today Haryana is at par if not ahead of Punjab. It has been able to put its agriculture on the fast track by better management of irrigation. The cities of Gurgaon, Faridabad and Rohtak have developed infrastructure at par with Delhi. Gurgaon even has better malls such that shoppers from Delhi commute to Gurgaon. Similarly, Uttarakhand was the backward part of united Uttar Pradesh. The five major towns Kanpur, Agra, Varanasi, Allahabad and Lucknow—all went to UP. Uttarakhand had no industry to speak of. Yet within ten years Kashipur and Rudrapur have emerged as preferred industrial destinations. Infrastructure, electricity supply and law and order are much better here than UP today.

Seemandhra can soon capitalize on its strengths. The city of Chittoor lies close to Bengaluru and other districts are not too far from Chennai. These can be developed like Gurgaon and Faridabad. It can become a power producing state because availability of ports enables it to produce electricity from imported coal. Main point is that the present prosperity of Hyderabad is manmade and can be replicated by Seemandhra; but the natural resources ol Seemandhra cannot be replicated by Telengana.

Another major benefit of a small state is that attention can be given to the problems of backward areas. The Government of United Punjab was more focused on Chandigarh, Ludhiana and Amritsar. The potential of Faridabad and Gurgaon was not important for it. Government of Haryana has given more attention to these districts leading to much improvement. Or, the united Uttar Pradesh was more focused on promotion of minor irrigation. These measures were not relevant for the hill areas. Here irrigation is mainly done by drawing water from the springs and rivers. It was not possible for the Government of Uttar Pradesh to give attention to this. The agricultural potential of Uttarakhand was not exploited. It has been possible to give attention to this after separation.

The backward areas of a big state are doubly hit. The State Government is not able to give attention to their special problems. Additionally, they are deprived of special reliefs that could be got from the Central Government. For example, the hill areas of Uttarakhand would not be entitled to get Special Package from the Central Government because they were part of the bigger state of UP. They have got this benefit after division of the state.

Contact with the public becomes easier in a small state. This writer was once living at Faizabad in the unified Uttar Pradesh. It was virtually impossible to meet a Minister or a Secretary. People in far-off areas find it difficult to reach the State Capital. A person would take about 24 hours to travel from Pithoragarh to Lucknow. People from Jharkhand would have to travel to Patna previously. Now they can reach Ranchi with relative ease.

It seems that there is an 'optimum' size of a state. A big state cannot give attention to its backward areas, cannot communicate with the people and cannot innovate. On the other hand, a small state is prone to crony capitalism and cannot administer properly in absence of skilled ministers and officials. The optimum size lies somewhere in between. The states of Chhattisgarh and Uttarakhand are doing relatively well. One may assume that their size is above the minimum viable size. On the other hand, states of Northeast are not doing so well. One may again assume these are not viable. A state comprising of about 10-15 districts is near the optimum. The division of Andhra Pradesh appears appropriate from this standpoint. Likewise it is not unjustified to consider the division of large states like Maharashtra and Uttar Pradesh into smaller states.

It must be pointed out that creating small states does not affect the main economic activity in any way whatsoever. The free movement of goods and persons across states is not influenced one bit. A person from Raipur can travel to Nagpur. Whether Raipur is located in Chhattisgarh or in Madhya Pradesh does not make a difference. Small states are better; provided they are not too small like the Northeastern states. Also, people should not get overly influenced by the apparent failure of Jharkhand. This is a small cost for the benefits that have accrued to the people in Uttarakhand and Chhatisgarh and rest of the country.

Vol. 46, No. 18, Nov 10 - 16, 2013

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