The much awaited event Pragati Nivedana Sabha (presentation of development report) conducted by TRS (Telangana Rashtra Samiti) government in Telangana state concluded with a show of strength of nearly 25 lakh people as claimed by the party before the general elections. People from all over the state have showed much enthusiasm in supporting the dream in making bangaru Telangana (golden Telangana) come true. The rhetoric is clear with welfare as the primary tool in gaining political strength before the elections.
In the one hour speech of Telangana chief minister KCR, he went on to summarise the vision of state government arising out of the long struggle for statehood and outlined his governments achievements in fulfilling the aspirations of the farmers, marginalised sections without compromising on the growth rate and fiscal slippage. It does not leave the critics to point some of the flaws from organisation of the event to the claims made by the chief minister.
First, any state required a sustained growth rate in achieving high degree of prosperity and material welfare of its people. While it is true that Telangana has consistently ranked 1 or 2 in the ease of doing business index in attracting the investments. Based on CAG report, KCR claimed that Telangana has achieved a growth rate of 17% in the previous 4 years and is only in increasing in the tax revenues, while the real GSDP growth rate is 10%. Increase in tax revenues has definitely contributed to the state budget in whole and the massive welfare program of state government.
Second, the welfare politics in the southern state of Telangana indeed are not a new feature that can be only attributed to the TRS party or KCR, it had begun much earlier in the state in the erstwhile state of unified Andhra Pradesh under the chief ministership of late YS Rajasekhara Reddy who took a series of initiatives to boost welfare policies. It is true to a certain extent that the region was neglected not in the distribution of welfare benefits but in asymmetric distribution of power, employment and water in the state policies. The Telangana movement was an outcome of that asymmetry. KCR government has certainly provided a new fillip to the welfare policies and created a new ecosystem in addressing some deep rooted problems. Take for example the raythu bandhu (friend of farmer) scheme which provides Rs.4,000 of capital investment twice a year to save the capital cost on small and marginal farmers before the cropping season for purchasing seeds, fertilizers etc., which is indeed a marvellous idea in addressing the farm debt crisis.
Third, while Indian state is a welfare state the question that arises is that, are farm subsidies really worth it in solving the long nature of agriculture problems being faced by the Indian agricultural system. To a certain extent, it will provide a sense of relief for the farmers however it also comes with a huge cost in the future; take for example the free subsidy on electricity given by Telangana government. Farmers who are largely dependent on subsidised electricity for pump set irrigation which account for major chunk in the state, there is a real danger in future of the irresponsible exploitation of ground water resources which is going to cause a major water shortage crisis in the near future. In the recently released composite water management index by NITI AYOG, Telangana flares as vulnerable to drought; the government needs to think in this direction in addressing the long term sustainable nature of the problem rather that targeting the populism.
Fourth, there is always a widespread misuse of fiscal space before the election year by the governments in announcing the extravagant schemes targeting the populist bases, economists express deep concerns regarding the election year due to its vulnerability to fiscal slippage and breach of FRBM targets. For past 4 years, Telangana has flared decently in sticking to the 3.5% of GSDP target and with increased revenue surplus the state was able to do well. The appreciation can be given to the TRS government for committing itself to the fiscal prudence. Even with much anticipation from the public and media houses, KCR did not announce any extravagant schemes; he rather stressed on his brief commitment to fiscal consolidation.
Fifth, employment was a key issue in the state since the Telangana movement. One of the Telanagan movement’s most pivotal demand was provision of employment to the locals in the government jobs. While it is true that the state did not see much employment rise in the government jobs exception being the non-administrative posts (technical), state has continued with the outsourcing policy of the previous government, while there is widespread discontent amongst the youth seeking government employment. The state has been successful in managing the discontent by creating a vibrant private sector in absorbing much of the unemployed. In the countryside, the government has targeted the caste professions in creating demand for their products. Much of the produce however was bought by the government alone; take for example the distressed siricilla textiles workers, who have one of the highest suicide rates in the state. Government, by creating festive bonanzas has bought many of their sarees to sustain the demand. Without creation of proper market this could not be sustained for long.
Telangana state and the series of reforms has certainly caused widespread attention amongst the other states in looking at some of the distinctive policies which directly target the poor and their upliftment. There is lot of room left to manoeuvre and correction to be done in strengthening the long dream of making bangaru Telengana rhetoric a true reality.