Update on India’s States: May 24, 2017

GST rates are set for more than 1,000 products; Andhra is building an industrial park in Sri Lanka; Odisha nearly doubles tariffs on captive power plants; Uttar Pradesh will build a solar park — in Rajasthan; Maharashtra makes it easier for government departments to transfer land to each other; Telangana is building India’s largest state-owned thermal power plant; Madhya Pradesh is developing a state Happiness Index; and more.

Center–State Relations

The Goods and Services Tax (GST) Council finalized tax rates for hundreds of categories of goods and services, one of the final hurdles before the tax can go into effect. The Council decided on five rates for both goods and services (0, 5, 12, 18 and 28 percent). Education and healthcare will be exempt from the tax, as are many common goods, while taxes on luxury items will rise. Source: Economic Times, Indian Express

Goods and Services Tax Tracker: Sixteen states — TelanganaBihar, Rajasthan, Jharkhand, ChhattisgarhUttarakhandMadhya PradeshHaryanaGoaAssamUttar PradeshGujarat, Andhra PradeshArunachal Pradesh, Odisha, and Maharashtra — have passed the model version of the Goods and Services Tax (GST). All 29 states must pass their own version of the law for the tax to become effective nation-wide.

Sri Lanka will allot 500 acres of land to the government of Andhra Pradesh to develop an industrial park. Source: The Hindu

Bihar’s cabinet agreed to raise pensions and employee salaries in line with the recommendations of the 7th Central Pay Commission. Roughly 365,000 state employees and 600,000 pensioners will see increases of 14 to 15 percent. Source: Business Today

Chief Minister Arvind Kejriwal carried out a cabinet reshuffle, appointing current members of the legislative assembly Kailash Gahlot and Rajender Pal Gautam to the Transportation and Water portfolios, respectively. Source: The Hindu

Nothing critical to report this week.

Chief Minister Manohar Lal Khattar is leading a delegation to Singapore to seek investment in Haryana. Source: DNA India

The Karnataka Legislative Assembly will meet for a 10-day session from June 5 to 16. Source: Indian Express

The cabinet approved creation of a special purpose vehicle between Karnataka State Industrial and Infrastructure Development Corporation and GAIL (India) Limited to expedite gas distribution in towns and cities along the route of the Dabhol-Bengaluru pipeline. Source: Hindu Business Line

The state government signed a Memorandum of Understanding (MoU) with the Indian Institute of Technology-Kharagpur to devise a Happiness Index for Madhya Pradesh. Source: The Hindu

The state cabinet approved a new policy simplifying land transfer between government departments in order to expedite infrastructure projects. Under the new policy, the agency responsible for developing a project will be able to submit a request for state-owned land well in advance of the commencement of work, and the chief minister will be able to approve or deny the proposal directly. Intra-government land transfers currently take six months on average. Source: Hindustan Times

Maharashtra signed an MoU with Energy Efficiency Services Limited (EESL) to increase the energy efficiency of nearly 1,500 buildings owned by the state Public Works Department. EESL will invest nearly $50.2 million to upgrade lighting systems and replace existing air-conditioners and fans with more efficient models. Source: Financial Express

Nothing critical to report this week.

The National Highways Authority of India (NHAI) signed an MoU with the Tamil Nadu Industrial Development Corporation Ltd (TIDCO) to develop a multimodal logistics park near Kamarajar Port. The national government plans to build 15 such parks across the country at a cost of $5.1 billion. Source: Economic Times

The center plans to distribute more than 30 million LED bulbs and tubelights as well as 1 million energy-efficient fans to consumers in Tamil Nadu. Energy Efficiency Services Limited will implement the project. Source: Economic Times

The Union Environment Ministry approved plans for a 4,000 megawatt (MW) coal-fired power plant proposed by Telangana Power Generation Company. It will be the first plant of its size to be built by a state-owned power utility. Source: Business Standard

Telangana’s amended Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act came into force. The new act makes land acquisition easier and faster by reducing the barriers for the state to exercise eminent domain. Source: Deccan Chronicle

The Telangana IT Minister announced the launch of the state’s Open Data Portal, a new central repository for all the government’s datasets. Source: Telangana Today In Detail: Open Data Telangana

In a first for India, the Uttar Pradesh government will build a 750 MW solar plant in another state (Rajasthan) and import the power generated by the plant through the national transmission network. The state plans to award the project via reverse auction by August 31, with commissioning targeted for October 2018. Source: Economic Times

Israel’s Ambassador to India Daniel Carmon met Chief Minister Yogi Adityanath to discuss Israeli assistance in cleaning the Ganges River, along with cooperation in other sectors. Source: Economic Times

The ruling Trinamool Congress in West Bengal won power in four of the seven civic bodies that went to polls on May 14, including one in the state’s hill district, where the party is historically weaker. A coalition between a local party and the Bharatiya Janata Party (BJP) won the other three municipalities, all in the hills region. Source: Hindu Business Line

Best of the Rest


The state government announced it would raise the duty on captive power plants by 83 percent, from 46 cents to 85 cents. The raise followed a previous hike of 50 percent last year and will produce additional revenues of $135 million per year. The move attracted intense condemnation from energy-intensive industries in the state. Source: Economic Times


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