Breaking even

There was euphoria in the Uttaranchal, Vananchal and Chhattisgarh regions when Parliament passed the bills for their statehood. INDIA today examines how justified the celebrations were.

August 14, 2000 | UPDATED 15:01 IST
There was euphoria in the Uttaranchal, Vananchal and Chhattisgarh regions when Parliament passed the bills for their statehood. INDIA today examines how justified the celebrations were. 

Poor Cousin

The amputation of Uttar Pradesh may not bring prosperity to Uttaranchal. The only significant earner in the 13 districts that will comprise the new state is the tourism industry which rakes in about Rs 250 crore every year. But tourism is a seasonal business and cannot sustain a state. With no major industries and limited job opportunities, the region subsists on a “money-order economy”, depending almost entirely on remittances from migrants.

Fact File

Main contenders for CM

R.P. Nishank – BJP

N. Swami – BJP

MLAs: 22 (BJP 17, Others 5)
Proposed capital:
Main occupation: Tourism
Problems: No other employment avenue except for tourism; full potential not realised; dependent on remittances from migrants.

“Those who question the economic viability of Uttaranchal are conspiring to stall the creation of the state,” laments Naveen Joshi who has been associated with the Uttarakhand movement and writing profusely in its favour. Joshi claims the state can be self-reliant and has tremendous potential in the information technology industry as well as new power projects, besides the booming tourism industry. He also points at the scope of fruit-processing units and medicinal plants in making the state self-reliant.

Joshi’s optimism about its potential misses the real tragedy of Uttaranchal. Despite having scores of rivers and streams, no major hydro-electricity project has come up in the region since independence. Similarly, hardly any attempts were made to boost the fruit-processing industry in the region or to initiate commercial production of the medicinal plants.

Harvested fruit often goes waste or is sold at rock bottom rates to traders from the plains. Medicinal plants are either smuggled out or sold cheap. N.B. Bhatt, another activist from Uttaranchal, says the new state will lag because “it would have the same set of politicians”.

The creation of Uttaranchal may change the political contours of the parent state. The hills are a traditional saffron bastion with an upper-caste majority. Though it would have an overwhelming majority in the new assembly with 17 of 22 cur rent MLAs in the House, the BJP would be precariously perched in the parent state with the loss of so many legislators. However, there is no immediate threat to the coalition Government led by Chief Minister Ram Prakash Gupta. Subhash Mishra


Bread Earner
When parliament passed the Bihar Reorganisation Bill, 2000 on August 2, clearing the way for a new Jharkhand – or Vananchal – state, people poured into the streets in Ranchi to celebrate. Drumbeats and frenzied calls of “Jai Jharkhand” filled the air while banners hailing the six-decade-long struggle fluttered gaily in the breeze.

Fact File

Main contenders for CM

Shibu Soren – JMM

B. Marandi – BJP

MLAs: 82 (BJP 32, JMM-S 12, Cong 11, RJD 9, Samata 5, JD-U 3, Others 9)
Proposed capital: Ranchi
Main occupation: Mining, iron & steel
Problems: The revenue Vananchal earns is not invested in the region but gobbled up by north Bihar.

People of the future Vananchal have reasons to celebrate. One of the many anomalies in Bihar was that the southern districts contributed almost two-thirds to the state’s revenue collections. Of the Rs 1,700 crore collected in sales tax in Bihar last year, Rs 1,200 crore came from the districts that will comprise Vananchal. Of the Rs 850 crore Bihar earns in royalty for the mining on its land, Rs 700 crore comes from the mineral-rich south. Major industries like Tisco, Telco and SAIL too are located in this region.
But in spite of all this, the southern districts have remained oases of under-development. Only a fraction of what they contribute is ploughed back into the southern districts while north Bihar, which has 65 per cent of the state’s population but contributes only a third of the total revenue, gobbles up the rest.

The impending divorce will change all that. Of the estimated Rs 4,200 crore collected in revenue annually, the new state will get Rs 2,215 crore while the truncated Bihar will be able to collect only Rs 1,985 crore. Since assets and liabilities are shared on the basis of population, the more populous north Bihar will have to bear a larger chunk of the state’s Rs 14,825-crore public debt.

The only silver lining for the residual state will be the enhanced share in Central taxes which is also decided on the basis of population. Of the estimated Rs 5,200 crore received as the share of Central taxes, the residual state will get about Rs 3,640 crore while Vananchal will have to be content with Rs 1,560 crore. With a total revenue of Rs 3,775 crore, Vananchal may be able to climb out of the poverty that north Bihar had imposed on it.

It is still too early to say who will form the new government in Vananchal after it parts with Bihar. The existing MLAs from the region will automatically become members of the Vananchal assembly. Being the single largest party with 32 MLAs, the BJP will certainly stake its claim to form a government. Sources say the likely candidates are Union Minister of State for Forests and Environment Babulal Marandi or Karia Munda.

But the Congress (11) and RJD (9) may rope in the support of JMM (Soren) leader Shibu Soren to form a government. Soren has staked his claim for chief ministership even though his party will have just 12 legislators in the 82-member House. Vananchal may eventually get a coalition government comprising the BJP, JMM (Soren), Samata Party (5) and JD (U) (3). The four parties will have 52 MLAs in the 82-member House. Sanjay Kumar Jha


Step Child
Chhattisgarh is among the most backward regions in the country, with a predominant tribal population and a dominant political class. The region is rich in minerals and earns a handsome royalty from mining activity for the state exchequer. The region is also the rice bowl of the state, supplying foodgrain to almost 600 rice mills. Chhattisgarh accounts for more than 70 per cent of India’s total production of tendu leaves that are used for making bidis. About 70 per cent of the total revenue generated in Madhya Pradesh comes from this region, earning Rs 500 crore just from Central excise.

Fact File

Main contenders for CM

V.C. Shukla – Cong

Ramesh Bais – BJP

MLAs: 90 (Cong 48, BJP 36)
Proposed capital: Raipur
Main occupation: Cultivation of tendu leaf and rice, mining
Problems: Neglected by politicians; the revenue from the region is not ploughed back into Chhattisgarh.

Given all this, it is inexplicable that poverty pervades the 16 districts comprising the region. That’s because the money that Chhattisgarh earns is not ploughed back into the region. As a result, the region has for long nursed a grudge against the rest of Madhya Pradesh which has treated Chhattisgarh like a colony.
The passing of the Madhya Pradesh Reorganisation Bill, 2000 by the Lok Sabha on July 31, paving the way for a separate Chhattisgarh state, may change all that. Once the 90-member assembly comes into being and a government is formed in the state, Chhattisgarh may expect better days. The Congress, which has 48 of the 90 MLAs, is all set to form the government. But if BJP leaders are to be believed, their party – which will have 36 MLAs in the new assembly – has set in motion a “secret plan” to give the Congress party a tough fight.

Chhattisgarh is already suffering from an oversupply of politicians. The Congress alone has over half a dozen leaders with chief ministerial aspirations. Most have already started lobbying. Among the names doing the round in the political circles are the Shukla brothers, Vidya Charan and Shyama Charan, AICC General Secretary Ajit Jogi, AICC acting Treasurer Motilal Vora, party MP Charan Das Mahant and state ministers Ravindra Choube and Satya Narayan Sharma.

In the BJP camp, Ramesh Bais, the party’s state in charge Lakhi Ram Agarwal and Raipur MLA Brijmohan Agarwal are seen as potential candidates for the chief minister’s post.

Leaders of the both parties have also made the location of the state capital and high court a point of contention. Some of them are in favour of Raipur being made the capital while others feel that Bilaspur would be the better option.

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