Business Yet To Begin

Absence of clear policies and direction holds back the activity including investments

Even after three months past founding Telangana state, the enthusiasm fast dying down. And Andhra Pradesh state is no different. There are no clear indications to the bureaucracy or set policies for development and growth. Of course, the captains of industry have visited Hyderabad, the capital of both the states, had consultations with both the chief ministers and expressed their wish to continue industrialisation in both the state, without giving any concrete plan of action.

Interestingly, both the states have early bird catches – Andhra Pradesh bags HeroMoto Corp, to set up plant in Chittoor, Telangana gets Cogent Glass, P&G and J&J in the backward Mahboobnagar district.

In the words of a veteran analyst, “The peoples’ perception is that both the governments are unable to swim comfortably through the bifurcation blues. Unfortunately even the Centre is not (visibly) involving to set it right.” To some extent, it is true that there is a need for handholding by Central Government for some more months till both the states withstand on their own.

For instance, Telangana Government is functioning without an annual budget and without an industrial road map. (It is understood that the budget presentation may be delayed by couple of months as government sought Governor’s nod for expenditure for two months).

“The Telangana Chief Minister and his team (of officials) are in the process of setting new parameters for growth, afresh. All the earlier guidelines under earlier governments are set aside and thrust is to reinvent new procedures on the basis of independent and government aided surveys”, says a bureaucrat in TS government, when asked for the reason for delays.

It is understandable, when a new government takeover the reigns, that to with the lots of aspirations, the delay can be condoned, but expecting an overnight change in the bureaucracy is not possible.

Further officials say the inordinate delay in the division of employees and officers is further causing hardship in the policy and administrative process.

It is not that the governments are keeping mum. Telangana Chief Minister boasts single window clearance program and personally monitoring it. He set a mission mode and set up task forces. This apart, he went on to Singapore to showcase the state and its opportunities for investments. On his part, AP Chief Minister plans to do so shortly with a visit to Japan. The states have ‘brand ambassadors’.

Thanks to the Center’s blessings, Andhra Pradesh had a major benefit in terms of signing agreements with power PSUs to set up thermal and solar power plants in the state. However, Telangana state still needs such a gesture from Central government. Apart from all these issue, the industry is also bothered about both the Chief Ministers indulging in political rhetoric. While Telangana chief points to how the region got a raw deal in united AP, and AP chief raises the bifurcation process was grossly unfair to residuary state. It is evident that both are resolved to do what it takes to put their respective States on fast track of development. “Most critical element for the successor States is GoI’s promised incentive package for backward areas,” say sources.

There lies the catch. Both AP and Telagnana are waiting for the roll out of sops as per the AP Reorganization Act, 2014 by the centre. Caught in the claims and counter claims, the NDA led centre is playing cool and diffident.

Interestingly, the government sources say that the union government wants the parliament to take a second look at the AP Reorganization Act, 2014 and reorient the lapses for the good of both the states. Despite have distant advantages, both the states have failed to cash in the early inertia by way of FDI caused by Modi regime. Both the States are in process of formulating new industrial policies driven by their Chief Ministers.

A new vibrant industrial policy to promote Telangana brand with right to single window clearance that put onus on officers to deliver within the stipulated time.

While in AP’s industrial policy, the single window system ensures ease of doing business especially for small and medium entrepreneurs and to create entrepreneurial climate.

As a veteran economic analyst put it, Telangana and AP lack in not just the industrial policy, but also an overall governance policy. ‘Both are worked up on what would be their revenues next financial year, what all poll promises they can fulfill?’