Telangana formation raises political and business concerns

The people of Andhra Pradesh are going to remember the year 2009 for its rarity and uniqueness. For the otherwise peaceful state, the year presented some of the most unlikely of events it had experienced since its formation. It began with Ramalinga Raju, a high-flying IT czar, admitting to massive fraud and diversion of funds. It is now ending with a bitter battle on the streets of the state over the formation of Telangana. The champion for the formation of a new state Telangana is the Telangana Rashtra Samiti.

Will it be business as usual after the formation of Telangana?

There are economic, political, and social repercussions of the decision to carve out a separate state of Telangana. The principal opposition party at the centre, the BJP, has accused the government of playing with the sensitivities of the people on the Telangana issue and reiterated its demand for a roadmap on the creation of a separate state. There is polarisation even among the members of the Congress party, both at the centre and the state. And the other parties are singing the popular tune so as to not lose its voter base.

To make the going difficult for the Congress, there has been a revival for the call for the trifurcation of UP, creation of Gorkhaland, Vidarbha and so on. The ease to give in to the demands of TRS Chief KCR has opened up a Pandora’s Box. The demands arising will be never ending and the centre’s biased attitude for certain states will neither be accepted by public nor by political parties. Hence a cautious stand by the government is of prime importance otherwise the situation in the country can turn volatile and violent.

There’s also a concern that the image and business of sectors such a real estate, IT and pharmaceuticals could take a beating, especially if Hyderabad is also changed as a result of bifurcation or trifurcation, or if the newly-formed state(s) gives preference to local workers. IT firms may explore locations within and outside the state to shift operations. There may be concerns for the ongoing projects like Outer Ring Road, Metro Rail, etc where a lot of investment has been done. IT being the largest employer in Andhra Pradesh, it’s necessary to prevent any kind of uproar from escalating. The industries need the government support for their smooth functioning.

As a result of division of the state areas like Warangal,Vishakhapatnam, Vijaywada, Kurnool, etc may gain increased attention and will stand to gain in terms of steep rise in real estate prices, increase of business opportunities, and development of SEZs.

Therefore, it’s up to the government to take a wise decision on the Telangana front.