Update on India’s States: December 30, 2016

The GST Council approves a draft GST compensation bill; one of Haryana’s discoms in the black thanks to UDAY; Karnataka proposes a 100 percent reservation for native workers in blue-collar jobs; controversial Delhi lieutenant governor Najeeb Jung resigns; Gujarat unveils new incentives for the aerospace and defense industry; Himachal Pradesh allows members of tribal groups to use their land as security for loans; Telangana wins approval to raise its debt limit to 3.5 percent of revenue; and more

Center–State relations

The Goods and Services Tax (GST) Council approved a draft GST compensation bill which guarantees compensation to the states if their revenue growth rate falls below 14 percent in the first five years of the new tax. The compromise sets the stage for the council’s next meeting, on January 3-4, when it will discuss the contentious issue of splitting collection powers between the center and the states. Source: Livemint

Government think tank Niti Aayog and the Ministry of Health and Family Welfare launched a new performance index measuring states’ health services and health outcomes. The purpose of the index is to measure yearly gains and thus nudge states to improve health outcomes and data collection. Source: Business Standard

Chief Minister Chandrababu Naidu met with a delegation from China’s Guizhou Province, including leaders of the State-owned Assets Supervision and Administration Commission of the State Council and heads of Guizhou-based companies. The two sides discussed possible Chinese investment in the development of the new capital city of Amaravati. Andhra Pradesh and Guizhou are sister states. Source: Indian Express

The World Bank approved a $235 million credit for the Bihar Rural Roads Project, with the goal of improving and effectively managing the state’s rural road network. The grant will support the construction of about 1,500 miles of rural roads. Source: Business Standard In detail: Press Release

In a surprise move, Delhi lieutenant governor Najeeb Jung resigned his position after more than three years of service. Jung’s tenure was marked by bitter struggles with the elected Aam Aadmi Party government. Source: Economic Times

Starting January 1, the New Delhi Municipal Council will cease accepting cash, with all taxes, utility bills, and fees for government services to be paid through mobile wallet or cards. Current over-the-counter transactions will also be performed online. Source: Hindustan Times

The Delhi government will cut fares on public buses by 75 percent beginning January 1 in an attempt to encourage the use of public transportation. Bus travel will be free for students up to the age of 21. Source: Economic Times

The Gujarat government unveiled its new Aerospace and Defense Policy 2016, which offers a slew of benefits and incentives for investors in the sector. Investors will be entitled to receive a 100 percent reimbursement on stamp duty and registration charges paid for the purchase, lease, or mortgage of land meant for a facility in the sector. If government land is available, investors will be allotted land at 50 percent of the usual price. Source: Business Standard In Detail: Gujarat Aerospace and Defense incentive scheme

Haryana’s Dakshin Haryana Bijli Vitran Nigam (DHBVN) — one of the state’s two power distribution companies (discoms) — became the first discom to eliminate its operating losses after joining a central government debt relief initiative. DHBVN, which joined the scheme, known as UDAY, on March 11, posted a profit of $30 million in the first half of the current financial year compared to a loss of $70.5 million last financial year. This represents DHBVN’s first operating profit since its founding in 1999. Haryana’s other discom posted a loss of $182 million in the first six months of the fiscal year. Source: Hindustan Times

Haryana has made the Energy Conservation Building Code mandatory for many government departments, including the Architecture Department, Public Works (Building and Roads), Haryana Urban Development Authority, Housing Board, Urban Local Bodies, and Municipal Corporations. The code sets minimum energy performance standards for commercial buildings. Source: Outlook India In Detail: Energy Conservation Building Code

Haryana connected 100 villages to Wi-Fi and launched 53 new e-governance services for six government departments. Chief Minister Manohar Lal Khattar also launched a new start-up incubator in Gurgaon, the “Knowledge Warehouse.” The program will initially accommodate 40 start-ups, with plans to expand to 80. Source: News 18

The Karnataka government has proposed a 100 percent reservation for natives of the state in blue collar jobs in the private sector. Start-ups and knowledge-based industries such as the IT industry are exempt from this draft policy. Source: The Hindu

In an effort to promote digital banking, the Madhya Pradesh government has waived all fees associated with depositing checks, demand drafts, real time gross settlements (RTGS) and national electronic fund transfers (NEFT). Source: Indian Express

The Bharatiya Janata Party (BJP) is still the single largest party in the state’s local government bodies following the third round of municipal and town council elections. The opposition Congress, however, scored a small victory, winning eight municipal council presidencies against seven for the BJP. Source: Indian Express

Cisco India has launched three new cyber security-related initiatives. It is set to open a security operations center in Pune in addition to its cyber range lab in Haryana. It also signed an agreement with the Indian Computer Response Team (CERT-In) to establish a threat intelligence sharing program to address digital threat and enhance cyber security training for employees and government officials. Source: NDTV

Rajasthan has instituted its own e-project monitoring system (e-PMS) portal, which will help track progress of and facilitate projects with investment portfolios ranging from $7.5 million to $148 million. Source: Times of India

KEF Infra, the infrastructure subsidiary of United Arab Emirates-based KEF Holdings, has opened the world’s largest industrial manufacturing park in Krishnagiri, Tamil Nadu. Source: Indian Express

Girija Vaidyanathan has been appointed as chief secretary of Tamil Nadu in place of P. Rama Mohan Rao, who is under investigation for corruption. Source: The Hindu

Telangana becomes the third state to get the center’s approval for a higher debt limit under the Fiscal Responsibility and Budget Management Act, winning approval for a limit of 3.5 percent compared to 3 percent limit for most other states. Telangana will also be allowed to raise an additional $460 million. Source: Times of India

The Uttar Pradesh government approved the conversion of 17 castes classified as ‘backward’ to scheduled castes on the recommendation of the Uttar Pradesh State Backward Class commission. The re-classification gives members of these castes access to increased government benefits. Source: News 18

Intex, a consumer electronics company, signed a memorandum of understanding with the Uttar Pradesh government to provide skills training to over 2,500 unemployed youth, with training centers across the state. Source: News 18

West Bengal will provide initial funding of $74,000 to each of the 125 municipalities in the state under its Green City Mission. The Green City Mission is the state’s alternative to the center’s Smart Cities initiative. Source: Indian Express

Best of the Rest:


With assembly polls due early next year, the BJP-led coalition government in Goa cut taxes on petrol from 15 to 9 percent, bringing the price to 88 cents per liter. This is the third time in the last four and a half years that the state government has lowered taxes on petrol in order to bring it to 88 cents per liter. Source: Business Standard

Himachal Pradesh

Himachal Pradesh chief minister Virbhadra Singh presented a bill in the state assembly to allow tribal people to use their land as security for bank loans. The current Transfer of Land (Regulation) Act, 1968 forbids members of tribal groups to mortgage their land. Source: Himvani


Leave a Reply

Your email address will not be published. Required fields are marked *