Braving unabated protests in the Seemandhra region, the Union Cabinet on Friday cleared the decks for introduction of the Andhra Pradesh State Reorganisation Bill in the Rajya Sabha on Wednesday.
The revised Bill rejects the demand for union territory status to Hyderabad, but offered tax sops and financial package for the Seemandhra region. The city will function as a joint capital of the proposed Telangana state and the truncated Andhra Pradesh (AP) state.
The Bill also proposes to increase the number of Assembly constituencies in the two states.
The Cabinet cleared the Bill after approving 32 amendments. Sources said the government will table the Bill the way it was sent to the AP Assembly and later move the amendments. The Bill will now go back to the President before being tabled in the Rajya Sabha on Wednesday.
According to the 294-page note presented in the Cabinet meeting, residuary Andhra Pradesh state should be given appropriate grants by the Centre which should also ensure that “adequate benefits and incentives in the form of special development package are to be given to the backward areas of the state”. A special development package for Rayalaseema and north coastal region are also envisaged.
For Telangana, the amendment envisages constitution of a separate Public Service Commission along with formation of the new state.
Another amendment to be moved is for increasing the number of Assembly seats in both the states. The note said the number of seats should be increased from 175 to 225 in Andhra Pradesh and for Telangana from 119 to 153.
Sources said while rejecting UT status for Hyderabad, the Cabinet tried to assuage the feelings of Seemandhra people by agreeing to provide tax incentives through one of the amendments. The Finance Commission will be asked to prepare a special financial package for Rayalaseema and coastal Andhra.
The move to create a separate Telangana state had triggered violent protests in the Seemandhra region and it stalled Parliament proceedings. Chief Minister N Kiran Kumar Reddy had staged a dharna in the capital, while Congress MPs from Seemandhra moved a no confidence motion against the Centre.