Jagan writes to Prez Pranab over division

Y S Jagan Mohan Reddy, MP                                                   Dt: 24th February 2014

President

To:                                                                                                   

Shri Pranab Mukherjee ji

H E President of India

Rashtrapathi Bhavan

NEW DELHI

Respected Sir,

Subject: Division of Andhra Pradesh

I sought your appointment to explain in person, the gross injustice that befell on the people of Andhra Pradesh with both Houses of the Parliament passing the State Reorganisation Bill 2014.

As I could not get your appointment, I place my views on the issue in this letter and submit to you.

The whole nation is aghast at the way the Parliament, especially the Lok Sabha, passed the AP Reorganisation Bill 2014 (Bill) with a voice vote, suspending almost all the MPs from Seemandhra region and blocking out the TV coverage. Even now it is not correctly known as to whether the proceedings of such an important occasion are video-graphed or not. It was certainly a black day for the world’s largest democracy and for young MPs like me, this is not something we would like to learn. Our Party tried our level best to stop the bifurcation of Andhra Pradesh as it is done against the majority decision of the State Assembly and the aspirations of a vast majority of people of our state. We tried our best to enlist the support of all opposition parties in Parliament to stop this dangerous precedent from becoming a new convention. All our efforts were in vain. Probably there is very little that one can do when the ruling Party  and the principal Opposition Party come together and decide to divide a State against all established Constitutional conventions, precedents and practices and against federal spirit, which is one of the basic features of our Constitution.  

The BJP, which emphatically said that they would never allow the Bill to be considered in Lok Sabha unless the suspension of all the MPs was revoked and a full-fledged discussion on the Bill takes place, for reasons best known to them, cooperated with the ruling party for dividing India’s first linguistic state without revoking the suspension of members and without any discussion, giving a complete go bye to all the established Constitutional conventions, practices and precedents, which require that a new state can be created either on the basis of recommendation of a Commission or a committee or upon receipt of a request from the state legislature. Sadly, in this case, both AP Legislative Council and Assembly have rejected the AP Reorganisation Bill in its entirety and despite this, most unethically, the Union Government for the first time in post-independence India, went ahead hurriedly pushing the Bill through in a manner that has lowered our country’s esteem. Where was the need for the Union Government to embark upon this important issue at the fag end of their ten year tenure, particularly when the schedule for the General Elections 2014 was just ten days away?

Surprisingly, there was almost a repeat performance in the Rajya Sabha, except that live telecast was not blocked. The BJP, which said that they could not propose any amendments to the Bill in Lok Sabha because, in their opinion, the Bill was not introduced in Lok Sabha, however, proposed 20 odd amendments in Rajya Sabha and declared in unambiguous terms that they would not allow the Bill be passed unless all the amendments were passed. Surprisingly, what happened latter was completely at variance with all they said. The BJP, as in the case of Lok Sabha, willingly cooperated with the ruling party in passing the Bill with a voice vote despite none of their 20 amendments were accepted. Even the request of BJP for division on the amendments was not accepted. The Hon’ble Dy Chairman pleaded helplessness in conceding to the demand of BJP for division on the amendments on the ground that the House was not in order, while the same did not come in the way for passing the Bill through a voice vote! Thus, the ruling party managed to get the support of BJP for the passage of the Bill without any of their amendments being accepted! 

The Prime Minister, however, gave some assurances, which, inter alia, include

1.         Special Category Status will be extended to the successor state of Andhra Pradesh comprising 13 districts, including the four districts of Rayalaseema and the three districts of north coastal Andhra for a period of five years. This will put the state's finances on a firmer footing.

2.         The Bill already stipulates that the Central Government shall take appropriate fiscal measures, including offer of tax incentives to the successor states in order to promote industrialization and economic growth in both the states. These incentives will be along the lines extended to some other states.  

3.         I would like to reassure Honourable Members that if any further amendments are needed to facilitate smooth and full Rehabilitation & Resettlement(R&R) for the Polavaram project, they will be given effect to at the earliest. Our government will execute the Polavaram project--let there be no doubt about it.

4.         The resource gap that may arise in the successor state of Andhra Pradesh in the very first year, especially during the period between the appointed day and the acceptance of the 14th Finance Commission recommendations by the Government of India, will be compensated in the Regular Union Budget for 2014-15.

The moot point is whether there is legal tenability for the aforesaid assurances, particularly when they do not form part of the Bill. Will the next Government be bound by the assurances given by a Government, which is on its way out? There is no clarity as regards what is meant by Special Status for Residuary state in the context of the point no 1 supra. If the fiscal incentives are given on par to both the states as per point no 2 supra, how can one expect the residuary state, which has been totally denied of its due share in manufacturing and IT business left behind in Hyderabad Metropolitan development area, to develop? Similarly, there is no clarity about the shortfall in the revenues of the residuary state. There is bound to be huge revenue deficit in the residuary state beginning with Rs 15,000 crores in the first year and this will gradually go up with each year passing as the residuary state which is forced to leave behind the engine of economic growth which is Hyderabad, in Telangana state, can never step up its revenues to cover the revenue expenditure. Para 4 supra says that the deficit in the first year alone will be compensated in the regular Union Budget 2014-15, without making it clear as to who will meet the revenue deficit from the second year onwards specially when the engine of growth (Hyderabad) is no longer with the residuary state and knowing very well that another engine of growth like Hyderabad to be created will take atleast 20 years’ time or even more. If this is not properly addressed, it will be a death-knell to the residuary state.

Since the Krishna river Ayacut spreads over 11 districts (2 ½ districts in Telangana & 8 ½ districts in Seemandhra ), the entry point in to Andhra Pradesh through Gadwal and Alampur constituencies, which is are a part of the Mahaboobnagar district now, it is very important to ensure that this part (mouth) should not be tampered with. Keeping in mind the future of these 11 districts, this area should be declared as “no tamper zone”. As it is, our State has been facing similar problems with both Karnataka and Maharashtra be it Almatti or Babli.

Dummugudem to Nagarjuna Sagar Tail Pond Project which is the only life line for Krishna Ayacut stabilization has no clarity.

The ownership and the operational modalities of dams, Srisailam and Nagarjuna Sagar should be clearly defined and the boundaries be clearly demarked as these dams have the gates on both the sides.  

There is no mention in the Bill as to the funds required for building new capital in the residuary state and as to how it will be funded by the Union Government. One should remember that a mere legislature, high court, Secretariat  and Govt. buildings alone do not constitute the term ‘Capital’. One should not forget the fact that  ‘Hyderabad’ is being denied unjustly and should be properly compensated for the residuary state. Even the time limit within which the Union Government would release funds for the Capital is also not part of the Bill. It should be borne in mind that something as a basic Metro costs Rs 20,000 crores and an International Airport costs Rs 5,000 crores. The Union Government should give the time frame for completion of the ‘capital’, which has to be at their cost.  If one goes by the experience of Chhattisgarh, which after 14 years after formation, has received a paltry sum of Rs 400 crores as against that Government’s requirement of Rs 10, 000 crores in those days, 14 years ago .There is no surprise that even in respect of the residuary state in this case, things will be no different. This fear should be adequately addressed.

Having denied Seemandhra its share in the share capital of the AP government in ‘Singareni Collieries Company Limited’, the only source of Power generation, there should at least be a provision in the Bill that ‘Royalty’ on natural gas, be it on-shore or off-shore, accrues to the residuary state instead to the Union government, as the drilling has severe ramifications of seismic activity & effects fishing activity adversely in the State. Union government’s share in these gas blocks in AP should be transferred to the State government of the residuary state as this would assure the State government of availability gas which is locally produced at affordable prices.

Special Category Status for 5 years will not serve any purpose as the minimum gestation time to set up any industry is 3 to 5 years and any engine of growth like Hyderabad to be created to compensate for the Revenue gap will take at least 20 years or even more. In this context how would this serve any purpose? This should be made at least 15 years to yield some result with specifics to compensate for revenue gap for at least 15/20 years.

In the light of the above, we request you to kindly ensure that at least our above concerns are addressed in a legally tenable manner.

I have enclosed a detailed note on state revenues for your kind perusal. 

With Regards