Update on India’s States: January 26, 2017


GST to be rolled out by July 1; Chandrababu Naidu attends the World Economic Forum in Davos; Samajwadi and Congress party form alliance to contest Uttar Pradesh elections; the second unit of Kudankulam nuclear power project attains 100 percent generation capacity; and more.

Center- State relations

The Goods and Services Tax (GST) Council broke a deadlock over issues of administrative control over assessees and broadly agreed to roll out the GST from July 1 instead of the earlier deadline of April 1. The GST Council resolved the right to tax economic activities within 12 nautical miles from India’s coasts. The entire tax base, for assessees up to $220,000 in annual turnover, will be shared between the center and states in a predetermined ratio. States will administer 90 percent of assessees with an annual turnover of up to $220,000 while the center will have the powers to audit, send notices, and scrutinise the remaining 10 percent. Source: Business Standard

The Ministry of Housing and Urban Poverty Alleviation has approved a $443 million investment for the construction of 78,703 additional affordable houses for the economically weaker population in Tamil Nadu, Kerala, and West Bengal. Source: Money Control


Andhra Pradesh chief minister Chandrababu Naidu participated in the World Economic Forum at Davos. He also held meetings with CEOs of various companies. Cybersecurity firm Cylance, Microsoft, and Aramco expressed interest in investing in the state. Aramco has already promised to send a team to scope the state for the company to build a refinery unit. Vedanta, in an attempt to extend is program to improve child care, will replicate its Nand Ghars program in Andhra Pradesh on a pilot basis. Source: The Hindu, Economic Times, The Hindu


Nothing critical to report this week.


Nothing critical to report this week.


The Gujarat government announced a salary hike, ranging from 63 to 124 percent, for its employees in the fixed-pay category under the seventh pay commission recommendations. The new salary structure, effective February 1, will cost the state exchequer $190 million. Source: Hindu Business Line

Wind turbine maker Suzlon Group received a commission for a 50.40 megawatt (MW) order from a leading power utility in Gujarat. It will be located in Kutch, to be completed by March 2017. Source: Indian Express


Haryana has made an in-principle decision to make it mandatory for regular payment of electricity bills when applying for government jobs, issuance and renewal of arms licenses, purchase of land plots, and approving blueprints and construction of plots measuring 250 square yards. Source: Indian Express

The Haryana government has reported a revenue of over $175 million through its e-stamping initiative from April to December of 2016. Source: Hindu Business Line

The Haryana government has offered partial refund of 1 percent on property tax deposits that were made through cashless transactions. Source: Indian Express

The Haryana forest department has signed a memorandum of understanding (MoU) with Patanjali Trust to develop a World Herbal Forest in Morni, Panchkula to be spread across 53,000 acres. Source: Economic Times


The Karnataka government has signed an MoU with the Ministry of Railways to institute a suburban railway system in Bengaluru. Source: Hindu Business Line


The investment promotion subcommittee in Madhya Pradesh approved six projects expected to bring $481 million worth of investment to the state. These include an integrated steel plant and an IT processing center, Source: Economic Times

The state has announced opening of 200 stores, which will provide medicines at cheaper rates under the central government’s Pradhar Mantri Janaushadhi intiative. Source: Business Standard


The state government has shifted the responsibility of providing water clearances for industry and drinking water from the state cabinet to irrigation corporations. If the demand for drinking water or small industries goes beyond the reserved amount, the clearance for diverting water will be conducted by the water resource minister, and for large industries will be approved by a cabinet subcommittee. Source: Times of India

The state finance department has prohibited any new purchases that cost more than $732 by any department in order to curb any misuse of funds before the end of the fiscal year in March. Source: Times of India


The state cabinet of Rajasthan has approved the rules for the Rajasthan Schools (Regulation of Fee) Act 2016. The rules specify that a committee of parents will be formed with the school management to decide school fees. All private schools will also have to create a parent-teacher association. Source: News 18


The center cleared an ordinance allowing the practice of Jallikattu, a bull-taming sport, in Tamil Nadu. In the midst of continuing protests, the decision was made to remove bull as a “performing animal” so that the rules under the Prevention of Cruelty to Animals Act do not apply to the bull. Source: Business Standard

The second unit of Kudankulam Nuclear Power Project (KNPP) attained its maximum generating capacity of 1,000 MW, six months since it went critical. Source: Economic Times


An industrial park for Korean investors will be set up by the state government in Telangana. This was announced as state IT and Industries minister KT Rama Rao is on a tour of East Asia to attract investment for Telangana. Source: Business Standard


The Samajwadi party (SP) and Congress party (INC) have announced that they will contest the Uttar Pradesh elections together on a 298 (SP)-105 (INC) seat sharing agreement. The results of this election will be available on March 11. Source: Economic Times


West Bengal has received investment proposals worth $34.4 billion through the recent Bengal Global Business Summit, which was held on January 20 and 21. These include $4 billion from Chinese investors to build a mass rail transit program, and collaboration with Korean companies to develop green city projects. Source: Economic Times

State-run power equipment maker BHEL has been commissioned for a 500 MW unit of Sagardighi Thermal Power Station Phase II in West Bengal. Source: Economic Times

Best of the Rest:

Tripura

The World Bank has sanctioned $201.6 million for complete upgrade and improvement of the power system network in Tripura. The project has been divided in to five phases and SPML Infra Ltd has been contracted for first phase estimated to cost $67.5 million. Source: Hindustan Times

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