Seemandhrites hope Hyderabad will remain joint capital

Telangana has long been a reluctant partner in the marriage with Seemandhra — a term coined by the media to jointly refer to Rayalaseema, a backward, drought-prone region comprising four districts, and coastal Andhra, a relatively prosperous delta belt with nine districts. The unhappy marriage has finally ended with UPA II granting statehood to Telangana, comprising ten districts including Hyderabad.

The announcement to carve Telangana out of a total of 23 districts in Andhra Pradesh marked a sense of closure for a prolonged, violence-filled movement and fulfillment of a long-cherished dream of the four crore people of the region. However, the much-awaited divorce has revived old wounds and questions over the viability of the new states, besides the future of Hyderabad, the bustling IT hub, which has been a major bone of contention between the people of Telangana and Seemandhra regions. As per the Centre’s road map, Hyderabad will be the common capital for a period of ten years till a new capital is built in Seemandhra.

After the announcement and the festivities a complex web of challenges started glaring at the government, emanating from the emotional upheaval and a deep sense of loss that the bifurcation has triggered in Seemandhra. Pertinent and emotive issues such as  resources sharing, river waters issues, funding for the new capital and sustaining industrialisation and employment generation is going to be a gigantic task.

Knowing the outcome, the Congress in a calculated move has put the decades’ old statehood issue on a fast-track and decided to carve out a separate state. The decision came in the wake of reports of the Congress’ stocks falling across the state and a bleak outlook staring at its face ahead of the elections. By carving out Telangana, the ruling party hopes to sweep the 2014 Parliament elections in the Telangana region which accounts for 17 out of the total 42 seats in AP.  By granting statehood to Telangana, the Congress hopes to neutralise two of its main rivals—the Telugu  Desam Party chief N Chandrababu Naidu  whose shortsighted, two regions- two eyes policy led to the erosion of his party’s support base in Telangana  and Y S Jagan Mohan Reddy who is seen as a formidable force in Seemandhra.

Even though the party is vertically split over the issue of Telangana, the Congress decided to play the Telangana card since the BJP had already promised to grant statehood in the event of the National Democratic Alliance coming to power in the next elections. The Congress is keen on taking the credit for fulfilling the aspirations of the people of Telangana region and reaping the electoral dividends.

Crucial role of Hyderabad

Even as the four-member A K Antony committee looks into the grievances of coastal and Rayalaseema Congress and the UPA government will have to address the problem of a new capital to the new state.  Hyderabad, which will now remain with Telangana has, over the years, become the economic powerhouse of the state accounting for 70 per cent of the state’s manufacturing sector and about 95 per cent of the IT business.

With a population of 80 lakh, of which about 40 per cent are migrants from Seemandhra, the city accounts for over 30 per cent of the state’s revenues. More than 90 per cent of the private sector investment that came to Hyderabad was from entrepreneurs from Seemandhra region. Also, 65 per cent of the Union government's revenue from AP are collected from the Hyderabad  metropolitan area. It contributes nearly Rs 90,000 crore to the state’s taxes kitty annually and accounts for software exports of Rs 60,000 crore.

Not surprisingly, there are fears over the safety for huge investments made by Seemandhra settlers since the formation of AP in 1956. Post-bifurcation, the Seemandhra region would suffer because of lack of funds at a time when they have to spend huge money on creating a new capital. The new, truncated state of AP will find itself dependent on the Centre for funds. Making the city a common capital after bifurcation will pose huge administrative challenges. Questions are also being raised over the viability of making it a Union Territory with elected representatives from the city, across the political spectrum, opposing such a plan.

It is argued that once Hyderabad goes under the control of the Central government, the taxes and levies collected in the metropolis would go to the Central kitty, depriving the two new states of the funds. There are also fears that there would be a flight of capital from the city if it is made capital of Telangana.  It is now home to about 1,000 information technology (IT) and IT enabled services companies including several global giants.

The uncertainty over the future of Hyderabad, forms the crux of the ongoing turmoil in Andhra Pradesh in the wake of the United Progressive Alliance’s decision to carve out a separate Telangana state.

Many observers feel that the 423 year-old city of minarets and pearls could go the Chandigarh way. While endorsing the plan to bifurcate AP, the Congress Working Committee said that Hyderabad would be the common capital for Telangana and the remainder of AP for a period of ten years. “This stop-gap arrangement of common capital is reminiscent of what happened to Chandigarh when Haryana was carved out of Punjab. As per the original arrangement, it was to be shared by Haryana and Punjab until Haryana constructed its own capital. However four decades later, with no new capital for Haryana, Chandigarh has become a united territory,” pointed out a Congress MP from coastal Andhra region who has been rooting for Union Territory status for Hyderabad.