Despite clarity on SCCL in Reorganization Act, Telangana and Andhra continue to differ on the issue
Differences over the bifurcation of state-owned mining company, Singareni Collieries Company Limited (SCCL), continue to affect Telangana and Andhra Pradesh seven-and-a-half years after the bifurcation of the erstwhile united Andhra Pradesh. This worrying issue continues to be on the agenda of the high level meetings convened by the Union Home Ministry. The Division of SCCL and its subsidiary APHMEL is on the agenda of the recent meeting of Chief Secretaries of both the states convened by Union Home Secretary Ajay Kumar Bhalla. However, there was no discussion on the issue as the meeting focused more on financial issues like power arrears between the two states.
The Andhra Pradesh government insists on bifurcating SCCL and its subsidiary Andhra Pradesh Heavy Machinery and Engineering Limited (APHMEL) on the basis of population ratio (58:42) included in the Andhra Pradesh Reorganization Act of 2014. But the Twelfth Schedule Act clearly states that 51% of the total equity of SCCL should be held by Telangana and 49% by Government of India. Section 92 of the Act states that the successor States shall, inter alia, comply with the principles and guidelines issued by the Central Government with effect from the appointed day (June 2, 2014) on matters relating to coal, oil and natural gas. In addition, the Act made it mandatory to split up institutions that have operational jurisdiction in both successor states. Officials say that Andhra Pradesh cannot claim exclusive rights over an institution that had operational jurisdiction in both the states.
The differences between the two states deepened after an order issued by the Andhra Pradesh government in 2018. The order sought the separation of APHMEL based on the recommendations of a committee headed by retired IAS officer Sheela Bhide that the unit should pass entirely to Andhra Pradesh. All of its assets and liabilities are located in that state. The Telangana government took serious objection to the “unilateral” decision of the neighboring state government and requested the Center to issue an interim direction suspending the recommendation. “There is apprehension that Andhra Pradesh may resort to unilateral acquisition of valuable properties of APHMEL near Vijayawada on the basis of their location,” the then Chief Secretary SK Joshi said in a letter to the Union Home Ministry.
APHMEL is a subsidiary of state-owned SCCL which holds 81.54% equity. The erstwhile Andhra Pradesh Industrial Infrastructure Corporation held 5.79%, the erstwhile United Andhra government held 0.86% and the public shareholders held 11.81%. Government of Telangana is firm that the institution is and will continue to be a subsidiary of SCCL. Only 0.86% equity of the then state government, which amounted to ₹14.90 lakh, was divided between the two states in the population ratio (58 for Andhra and 42 for Telangana).
The matter was settled when a circular was issued by the SCCL Board approving the change of 51% stake of the Government of Andhra Pradesh in the name of Government of Telangana in accordance with the provisions contained in the Twelfth Schedule to the Act with effect from June 2, 2014. The SCCL Board consists of the representatives of the Central Government. The Center, however, continues to consider the requests of Andhra Pradesh. This allows the issue to be on the agenda for discussion between the two states, despite repeated representations made by Telangana. Time has come for the Center to end this controversy. Doing so will help focus the attention on other issues between the two states.
rajeev.madabhushi@thehindu.co.in
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