How Andhra, Telangana fare 10 years after bifurcation
10 years after separation, Telangana and Andhra Pradesh show similar GSDP gaps. Telangana leads in per capita GSDP but lags in wealth distribution
June 2 marks 10 years of Telangana as a separate state. While the movement for a separate Telangana goes long back in history, the final push was motivated by perceived inequality in development and the claims of political and economic elite in united Andhra Pradesh usurping most of its rewards. How have the two states done a decade after their separation.
Trajectory of Andhra Pradesh and Telangana GSDP
Centre for Monitoring Indian Economy’s (CMIE) States of India database gives GSDP values for Telangana and Andhra Pradesh from 2011-12 onwards. Andhra Pradesh’s GSDP at ₹3,79,402 crore was 1.07 times than that of the Telangana in 2015-16, a year after their split. This gap has largely remained stagnant since then with only marginal deviation over the years. In terms of per capita GSDP, however, Telangana has fared better than Andhra Pradesh. The per capita GSDP of Telangana was 1.27 times higher than that of Andhra Pradesh in 2015-16. This gap has seen gradual increase since then with the per capita GDP of Telangana being 1.31 times that of Andhra Pradesh in 2023-24. Notably, the gap in GSDP between both the states had seen consistent decline between 2014-15 and 2019-20. However, the pandemic-induced contraction in Telangana’s economy in 2020-21 undid some of this progress in closing the gap, as Andhra Pradesh registered a positive GSDP growth during the year. To be sure, both these states have had a higher compound annual growth rate than India’s overall GDP during this period. (See Chart 1)
Most of Telangana’s wealth is still concentrated in the greater Hyderabad region
This is apparent from the fact that the four districts with the highest Gross District Domestic Product (GDDP) in Telangana, namely Rangareddy, Hyderabad, Medchal-Malkajgiri, and Sangareddy belong to the Hyderabad Metropolitan region. In fact, the combined GDDP of Rangareddy and Hyderbad alone in 2021-22 was higher than the sum of GDDP of the bottom 25 districts. There were 13 districts till they were split to create 26 districts in 2022. However, the district-wise GDDP figures for the state, the latest of which is the first revised estimate from 2021-22, is only available for the undivided 13 districts. These figures show that wealth is more evenly distributed in Andhra Pradesh compared to Telangana. This is evident by the fact that out of the 33 districts in Telangana, only five has a higher GDDP than Vizianagaram, the district which had the least GDDP in Andhra Pradesh.
Wealth distribution among the population
The National Family Health Survey (NFHS) contains data on the state wise wealth distribution of the population. The NFHS-4 report, which contains data from 2015-16 shows that in Andhra Pradesh and Telangana, as much as 52.4% and 49.4% of the population respectively belonged to the lowest three wealth quintiles. Meanwhile, 47.6% and 50.6% of the population belonged to the highest two wealth quintiles in both states, respectively. However by NFHS-5, in 2019-21, the proportion of the population in the lowest three wealth quintiles increased to 55.6% and 50.4% in Andhra Pradesh and Telangana respectively. To be sure, the proportion of population in lowest quintile specifically in Telangana has seen a decline over this period from 6.3% to 5.1%, while in Andhra Pradesh, this figure has gone up from 4.6% to 5.2%. (See chart 2)
Fiscal prudence
Telangana has done comparatively better than Andhra Pradesh when it comes to controlling its fiscal deficit. The former has had consistently lower fiscal deficit as percentage of GSDP compared to the latter . Telangana’s low fiscal deficit has largely been because it is a revenue surplus state unlike Andhra Pradesh. Except for the years 2019-20 to 2021-22, Telangana has registered a revenue surplus in every other year since 2014-15. This has been mainly due to the state’s own tax revenue which has ranged from 53% to 72% of its revenue receipts over the years.(See chart 3)
How both states have fared in social development indicators
HT analysed 11 development indicators from the NFHS report dealing with social welfare. Out of these, Andhra Pradesh showed improvement in nine of the indicators between 2015-16 and 2019-21 while Telangana only improved in seven. Telangana did especially badly in the indicators related to child nutrition, with the state registering an uptick in stunting, wasting and insufficient nutrition in children below five years of age. Telangana and Andhra Pradesh both saw a decline in the proportion of mothers who had at least four antenatal care visits. There has also been a decline in the proportion of men with 10 years of more schooling in Andhra Pradesh.
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