Chief Minister K Chandrasekhar Rao can look back at his performance with satisfaction. If he decides to throw his hat in the ring for the Prime Minister’s post, he has something to show for him.
Eight years ago, the state of Telangana was carved out of Andhra Pradesh. The historical context goes back to the days after Independence when states were reorganized on a linguistic basis. The people of the Telangana region believed they were at a disadvantage vis-a-vis the better-developed rest of Andhra Pradesh and demanded a separate state. Though the denouement was essentially political, with the Congress party trying to milk political mileage out of its support for the creation of Telangana, the move did fulfill a long-standing demand.
The Congress did not get any political mileage as Telangana leader, K Chandrasekhar Rao (KCR) walked away with all the credit. For many years, KCR was even seen to be on friendly terms with Congress’ arch-rival, BJP, though in recent years the redoubtable politician is looking more independent and assertive, perhaps aspiring for the Prime Minister’s post.
KCR’s political ambitions have to ride on his performance. On this count, data shows that Telangana’s social and economic performance has been satisfactory, perhaps even creditable for a fledgling state.
RANKED HIGH IN ECONOMIC AND SOCIAL INDICES
Telangana was ranked second in the country in providing clean water and sanitation in the Sustainable Development Goals (SDG) India Index and Dashboard 2020-21 released by NITI Aayog as of June 2021. Under another programme, it has revived 46,531 lakes and tanks and created an additional forest cover of 12.63 lakh acres, planting 243 crore saplings at a cost of Rs 8816 crore. These claims sound laudable.
A look at the fiscal numbers reveal a satisfactory picture. For instance, all states had to contend with an increase in state gross fiscal deficit during the pandemic. Telangana’s fiscal deficit rose 43.33 per cent to Rs 45,509 crore in 2021-22 (Budget Estimates) from 2019-20, compared with 55.21 per cent for Karnataka, 67.20 per cent for Tamil Nadu and 65 per cent for West Bengal. Of course, some states like Maharashtra (23.66 per cent) had done even better; Andhra Pradesh recorded even a 6 per cent decrease in fiscal deficit. Yet, Telangana’s record is commendable.
In terms of revenue deficit, Telangana turned a surplus in 2021-22 (BE), of Rs 6743 crore from a deficit of Rs 6254 crore in 2019-20. Comparatively, Tamil Nadu’s revenue deficit was Rs 58,692 crore, up from Rs 35,908 crore in 2019-20, making it the worst-performing state on this count. Telangana’s numbers are also better than those of Karnataka, Maharashtra and Andhra Pradesh, which have posted revenue deficits of around Rs 10,000 crore, Rs 15,000 crore and Rs 5000 crore (BE) respectively.
HANDSOME EXPENDITURE ON DEVELOPMENT
Even through the pandemic, Telangana did not ignore development. ‘Development expenditure’ of the state increased 77.82 per cent between 2019-20 and 2021- 22, to Rs 1.72 lakh crore—which compares well with Andhra Pradesh and Karnataka (Rs 1.58 lakh each) and Rs 2 lakh crore of Tamil Nadu—all of which are larger than Telangana. Even in terms of percentage of growth, Telangana’s 77.82 per cent is a lot better than 38.29 of Tamil Nadu, 49.15 of Andhra Pradesh and 14.36 of Karnataka. Telangana’s development expenditure as a percentage of aggregate expenditure, at 75 per cent, is the highest for a large state and only slightly lower than National Capital Territory’s 76 per cent. These numbers lend credence to the state’s claims on development.
Telangana’s own revenues account for 73 per cent of its revenue expenditure, the second-highest, after Gujarat (77 per cent) and markedly better than Karnataka (64 per cent), Andhra Pradesh (50.7 per cent) and Tamil Nadu (54 per cent). The state’s interest payments as a percentage of revenue receipts are just 10 per cent, compared with Tamil Nadu’s 20.5 per cent, Karnataka’s 15.8 per cent and Andhra Pradesh’s 12.8 per cent – meaning that Telangana has headroom to borrow more, when needed.
Indeed, Telangana, whose borrowings net of repayments in the last three years stand at Rs 87,812 crore, compared with Tamil Nadu’s Rs 1,61,622 crore, Karnataka’s Rs 1,04,400 crore and Andhra Pradesh’s Rs 96,060 crore. One might argue that Telangana is a smaller state than its neighbours and hence its borrowing needs were less. That’s why one should look at states’ total outstanding liabilities as a percentage of state GDP. On this count, Telangana is among the best, at 27.4 per cent, compared with Tamil Nadu’s 31.6 per cent and Andhra Pradesh’s 37.6 per cent; only Karnataka’s 25.7 per cent is better than Telangana’s.
EXCELS IN HEALTHCARE…
Even on social parameters, Telangana has done quite well. A recent report of World Bank and Niti Aayog, which looked at ‘health’ in various states, has this to say: “Telangana emerged as a strong performer on both Overall and Incremental Performance as for several indicators it had attained the best possible performance. For example, it attained universal full immunization of children and total case notification of tuberculosis; had fully functional First Referral Units (FRUs) and all Primary Health Centers (PHCs) and urban PHCs functional as Health and Wellness Centers (HWCs); operation theatres and labor rooms of all district hospitals certified under LaQshya and Kayakalp scores more than 70 percent; and no vacancies of ANMs in sub-centers and Medical Officers in PHCs. In terms of Incremental Performance, Telangana made major gains in the Key Inputs and Processes domain with nearly half the indicators in the Fully Achieved or Most Improved or Improved category.” Such kudos don’t come easily.
There are areas for improvement too. For instance, Niti Aayog’s ‘state Energy and Climate Index’ (SECI), Round-1 report, of April 2022, ranks Telangana 11th among 20 large states. The study focused on all aspects of energy, such as discom performance, energy efficiency and environmental friendliness and classified states as ‘Front Runners,’ ‘Achievers’ and ‘Aspirants’. Telangana figures among ‘Achievers,’ along with all southern states. (Gujarat tops the list.) Karnataka, Tamil Nadu and Andhra Pradesh rank 8, 9 and 12, respectively. Telangana is in good company, but there is scope for improvement here.
Finally, the state seems to be able to attract investments. KRC famously got the Kitex group to Telangana, with an investment of Rs 1000 crore, when the group was not so happy with Kerala. And now, Rajesh Exports, a company that manufactures and exports jewelry, which is diversifying into batteries and electric vehicles, has announced a multi-crore investment in Telangana, to manufacture display fabs and lithium-ion batteries, through its subsidiary, Elest. Typically, after an anchor investor comes in, others follow. For example, after Ford came to Tamil Nadu in the early 1990s a clutch of other big-ticket investments, like Hyundai and Saint Gobain, followed. Telangana hopes that more investors will follow Rajesh Exports.
Overall, Chief Minister KR Chandrasekhar Rao can look back at his performance with some sense of satisfaction. If he decides to throw his hat in the ring for the Prime Minister’s post, he has something to show for him.
