Political idiom & economic data

​The recent official documents presented to the AP State Legislature on the eve of presentation of the budget make two things clear. The consequences of bifurcation were and continue to be devastating. The Central government support was not there. Still, the economy of Andhra Pradesh is booming.

Though the Finance Minister wants to attribute the entire economic marvel to the leadership of N Chandrababu Naidu, skeptics see a yawning gap between political idiom on bifurcation and the economic performance of the residuary State of Andhra Pradesh

The period during the movement for a separate State of Telangana saw an intense but vertically divided debate over the possible fallout of the bifurcation of the State. Emotions and passions rose on both sides, yielding rich political dividend for the TRS in Telangana and TDP in Andhra Pradesh. The prevalent political idiom then continues to dominate the political discourse in the post-bifurcation period, too.

The Telangana rulers remind us of the injustice done to Telangana in the united Andhra Pradesh, while the ruling party leaders in Andhra Pradesh remind us of the bizarre consequences of the manner in which the State was divided. Yet, the economic data put out officially by both the governments indicate buoyancy in the economy of both the States since the bifurcation.
The Socio Economic Survey 2015-16 of the Government of Andhra Pradesh presented to the state legislature along with the budget documents said, “Even after 21 months of state bifurcation, the problems persist…” but went on to claim that “despite severe bottlenecks in the wake of state bifurcation, the state has recorded appreciable progress in terms of inclusive growth with noteworthy performance in both development and welfare sectors.”

Despite global gloom and mere optimism at the national level, the local exuberance characterises the state of the economy of Andhra Pradesh. This is what the budget speech of Andhra Pradesh Finance Minister stated that too in a situation described by the speech itself as the one in which the state “faced and continue to face several challenges , of which the most daunting has been to find the resources required for financing the development needs of the state.”

As per the official statement of Andhra Pradesh government, the Centre has not supported the State contrary to the claims made by the leadership of Government of India and the party that heads it. In an explicit indictment of the Union government in which the ruling party of the State is a partner, the Socio Economic Survey said,

“The assurances of the union government to the state of Andhra Pradesh in the AP Reorganisation Act, 2014, and in the speech of the then Prime Minister in Rajya Sabha to support the state on several fronts still remain mostly unfulfilled.” The survey further states, “No special preference was given to the state despite requests for handholding support,

excepting the usual allocations made to other states, as per their eligibility.” The document went on to state that the Union Budget 2016-17 also did not make any special and noteworthy allocations to the State.

The above extracts from the recent official documents presented to the State legislature on the eve of presentation of the budget make two things clear. The consequences of bifurcation were and continue to be devastating. The Central government support was not there. Still, the economy of Andhra Pradesh is booming.

Though the Finance Minister wants to attribute the entire economic marvel to the leadership of N Chandrababu Naidu, skeptics see a yawning gap between political idiom on bifurcation and the economic performance of the residuary State of Andhra Pradesh.

The global growth slowed down from 3.4 per cent in 2014 to 3.1 per cent in 2015. The Indian economy grew by 7.3 per cent. But during the same period Andhra Pradesh registered a high growth rate of 10.9 per cent. The Finance Minister punctuates his economic analysis with a reiteration of political idiom when he stated, “we have accomplished this in the face of adverse legacies of the past that continue to haunt the present.”

Unlike the national economy and even the economy of the neighbouring Telangana state, that are plagued by severe sectoral imbalances especially agriculture deceleration, Andhra Pradesh economy has achieved a fairly equitable growth. Agriculture in Andhra Pradesh has registered a growth of 8.4 per cent, compared to the national average of 1.12 per cent and the Telangana agricultural growth rate of only 0.8 per cent.

Despite losing the alluring information technology sector to Telangana in the wake of bifurcation, the services sector in Andhra Pradesh has recorded a growth of 11.39 per cent against India’s 9.19 per cent. However, helped by the promising IT and ITES sector, the services sector in Telangana grew at a much faster rate primarily propelling the State economy despite agrarian distress.

Even the industry in Andhra Pradesh grew at an impressive rate of 11.13 per cent compared to the national performance of 7.35 per cent. In fact, the industrial growth rate in Andhra Pradesh is even higher than that of Telangana despite having Hyderabad and the industrial suburbs in it.

However, Telangana continues to outsmart Andhra Pradesh in services sector. But, while the agricultural sector in Andhra Pradesh grew at a rate of 8.4 per cent, it was a meager 0.8 per cent in Telangana. As agriculture is the source of livelihood for more than half of the population, this augurs well for the State.

In fact, the national average of agricultural growth rate remained at 1.12 per cent only. The nation failed to achieve even the modest target of achieving 4 per cent growth rate in agriculture in the last four five-year plans, including the ongoing 12th plan period. Thus, the legacy of high agricultural growth seems to endow Andhra Pradesh.

The per capita income of both Andhra Pradesh and Telangana crossed Rs 1 lakh far exceeding the national per capita income. The budget speech of the Andhra Pradesh Finance Minister further makes it clear that the State will continue to script the growth story, notwithstanding “adverse global factors and modest national growth scenario.”

The State government through the budget speech averred, “Encouraged by the performance of the economy in 2015-16, we set ourselves an ambitious, but achievable, target of economic growth for the next financial year spread across all sectors of the economy.” But, the State government seems to be banking on public, private, people’s partnership in writing this ambitious growth story.

Quoting Shakespeare, the Andhra Pradesh government took extra caution to clarify that the National Democratic Alliance-led Central government is not a partner in catapulting the State onto high growth trajectory. This is despite the loud claims made by BJP’s central leadership led by Amit Shah himself in the land of Andhra Pradesh.

The Finance Minister in his budget speech said: “Our performance which is impressive by any standards, has been contributed not so much by generous support from the central government…” Thus, the political strategy of selling the dream of a scintillating Andhra Pradesh while perpetuating the nightmare of bifurcation.

The discrepancy in economic data and political assertions is, therefore, not accidental. It’s part of a calculated strategy to manufacture consent that turned the fortunes of ruling Telugu Desam Party from that of a party facing an existential threat in 2012 to a bullish state in 2014 and after.