Kiran Reddy moves SC against Telangana state formation

Reddy had resigned as Andhra Pradesh Chief Minister and quit Congress to protest Centre's decision to carve out separate state of Telangana, giving jitters to the ruling party in coastal Andhra and Rayalaseema.

The 53-year-old leader, who was widely speculated to form a new party, has dropped the idea.

The decision to break up the state was made ahead of elections due in April. Critics say the Congress party, which proposed the bill and leads a coalition government, is seeking to shore up its political fortunes after dragging its feet over an issue that has lasted four decades.

Supporters say Telangana's economic development has been neglected in favour of the richer and more powerful coastal region and that a new state is the only solution.

Apart from the emotional reasons for opposing the division of Andhra Pradesh, Hyderabad was also a bone of contention as it fell in the proposed new state carved out of the western part. India's sixth largest city, it is also one of its most prosperous and a big generator of revenue.

TRS has been fighting for a separate state of Telangana would likely merge with Congress in the new entity. Congress may stand to benefit as it could gain parliamentary seats in Telangana in a show of gratitude for statehood.

The new state would account for 17 seats in parliament.