Update on India’s States: August 3, 2016

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This week, Gujarat’s chief minister announces her resignation; the GST might actually be in the bag; the center is drafting an investor-protection agreement for states to sign; Malaysia makes a big bet on infrastructure in Maharashtra; Karnataka stands up its Start-up Cell; Madhya Pradesh imposes a flush toilet requirement on all candidates for village elections, and more.

Center–State relations

The Union cabinet approved key changes to the constitutional amendment creating the goods and services tax (GST), doing away with a 1 percent additional levy on passage of goods across state borders and allowing states full compensation for lost revenue. Source: Livemint

The center is drafting a center-state investment agreement as an extension of India’s Bilateral Investment Treaty. A draft policy proposes that states sign an agreement promising foreign investors non-discriminatory treatment, protection against expropriation, the establishment of Investor State Dispute Settlement mechanisms, and a cap on compensation awards against foreign investors. Source: Economic Times


Andhra Pradesh signed a Memorandum of Understanding (MoU) with Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) to develop the food processing industry in the state. MAFF will encourage direct investments by Japanese companies in agriculture and food-related industry. Source: Economic Times

Kii, a California- and Japan-based Internet of Things (IoT) provider, signed an MoU with Andhra Pradesh to help enable development of the local IoT ecosystem, both in terms of current innovation as well as in terms future IoT talent supply. Source: Voice and Data


The Bihar cabinet gave its approval for the creation of new universities at Patna and Purnea. Source: Economic Times

Bihar’s assembly passed stringent and controversial prohibition legislation, the Bihar Prohibition and Excise Bill, 2016, over the objections of the opposition. The bill bans all production or consumption of liquor in the state and specifies penalties of up to three years’ imprisonment. Source: Business Standard


Nothing critical to report.


Gujarat chief minister Anandiben Patel submitted her resignation via a public Facebook message. Patel, 74, claimed that she was observing her party’s informal prohibition against holding political past the age of 75, but her tenure as chief minister has been marked by unrest in Gujarat’s Patel and Dalit communities. Source: Indian Express

Thousands of Dalits gathered in Ahmedabad to protest against the flogging of a Dalit family by ‘cow protection’ vigilantes who accused them of skinning a dead cow. Community leaders urged Dalits to stop disposing of animal carcasses and cleaning sewers in order to “send a strong message” to the state government. Source: International Business Times


Haryana has launched an e-Biz portal to promote ease of doing business, help clear industrial projects, and redress investor grievances. The portal includes a Comprehensive Application Form which can be filled out online and will facilitate state response on a wide variety of issues. Source: Times of India


Nine months after announcing its start-up policy, the Karnataka government has set up a dedicated Start-up Cell to guide implementation. Start-ups registered with the Cell receive a Start-up Karnataka Booster Kit (including software tools, cloud credits, access to mentors, referrals to legal and accounting consultants, and access to government funding and government-supported incubators) and have easy access to the incentives and concessions provided under the Start-up Policy 2015-2020. Source: Hindu Business Line

Apple has identified a location in North Bengaluru for its design and development accelerator. Apple hopes the center will encourage more developers to build applications for the iPhone. Source: Business Standard

The Karnataka government has announced a 12.5 percent pay hike for transport employees after a three-day strike which crippled transportation networks in the state. Source: NDTV

The Madhya Pradesh Assembly passed a bill requiring candidates in Panchayat (village council) elections to have flush toilets in their homes. The Assembly session ended on July 30. Source: Business Standard, The Hindu

Malaysia’s state-owned CIDB Holdings agreed to invest $1.5 billion in highway and road projects in Maharashtra, including the ambitious 440-mile Nagpur-Mumbai expressway. Source: Indian Express

The center cleared a $1 billion infrastructure development plan for the Shendra-Bidkin industrial area, part of the proposed Delhi Mumbai Industrial Corridor (DMIC). The centrally-controlled DMIC Trust will provide $500 million for the development. Source: Business Standard


Rajasthan industries minister Gajendra Singh said that the state has identified land for as much as 70 percent of the agreements signed during the Resurgent Rajasthan summit last year. Source: Indian Express


State-run power company Bharat Heavy Electricals won an order to build a 65 megawatt (MW) solar photovoltaic power plant for the Neyveli Lignite Corporation at Neyveli, Tamil Nadu. Source: Economic Times


Telangana has integrated more than 700 MW of solar energy into its grid, doubling the center’s target of 5 percent of peak demand. Telangana discoms expect to add another 1,500 MW of solar power by March 2017. Source: Deccan Chronicle

As part of its Non Resident Indian (NRI) Policy, Telangana will launch an exclusive portal for NRIs and also open a Center for Non Resident Telanganites Affairs’ in each district of the state. Source: Business Standard


The center sanctioned assistance of $92.5 million to Uttar Pradesh to help the state recover from a recent drought. Source: Business Standard

The Uttar Pradesh Economics and Statistics ministry announced that per capita income in the state had increased to $730 in the most recent financial year, up from $530 in 2012-13. Source: Economic Times

Storage and data management company NetApp signed MoUs with Varanasi and Karnal Municipal Corporations to assist their Smart City initiatives. The company will provide storage, surveillance and security infrastructure for the projects. Source: Economic Times


West Bengal chief minister Mamata Banerjee claimed the state’s gross domestic product has nearly doubled since 2010, from $69 billion in 2010-11 to $137 billion in 2015-16. Banerjee ascribed growth to the increase in plan and capital expenditure under her government. Source: Business Standard

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