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Full Text | 'What a State Gives, it Must Get Back': Telangana Deputy CM on Fiscal Federalism, Fair Share

'Suddenly if you ask states to stop better schemes they are already running and adopt central ones that aren't exactly what was there earlier, people won’t accept it.'
'Suddenly if you ask states to stop better schemes they are already running and adopt central ones that aren't exactly what was there earlier, people won’t accept it.'
In this screenshot posted by @Bhatti_Mallu via X, Telangana Deputy Chief Minister and Finance Minister Bhatti Vikramarka presents the State Budget for 2025-26 in the state Assembly, in Hyderabad, Wednesday, March 19, 2025. Photo: Via PTI.
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Deputy chief minister of Telangana, Mallu Bhatti Vikramarka spoke exclusively with The Wire's political affairs editor, Ajoy Ashirwad Mahaprashasta in Delhi recently. Vikramarka spoke of various issues including center-state relationships and the burden faced by southern states.

The following is the full text of the interview, transcribed by Maryam Seraj, an editorial intern at The Wire. The text has been edited for clarity. 

Ajoy Ashirwad (AA): Among the many states that have raised concerns around issues of worsening state centre-state relations, Telangana has been at the forefront, it has raised, consistently, issues of fair share in devolution of taxes or of a fund crises in the implementation of central schemes, and even social redistribution strategies of how they want to implement. And it has differed with the Centre on a range of issues. The Congress leadership in Telangana has been constantly at the forefront to talk about these issues and alert the Centre. They have demanded a better share of taxes and they have raised pertinent issues of how they could implement their own social welfare schemes. Among all the critics, the name of Mallu Bhatti Vikramarka is one of the most prominent. He can be seen many times talking in great detail about what are the issues that the government has faced while governing Telangana in the last few years. He is with us today and we'll be talking about all these issues.

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Sir, how do you assess the centre-state relations ever since you have joined the government here and have been elected to power? 

Mallu Bhatti Vikramarka (MB): See, ours is a parliamentary democracy. One should not forget that we have a lot of the spirit of federalism. That spirit has to be taken care of by the Centre and also, of course, the states.

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But unfortunately, in the name of “one nation, one tax,” and for the concentration of powers, the money collected through tax has had a big impact on the states, leaving them unable to make their own plans and designs. While respecting the Centre, the states also have to design their own schemes, because each state has its own demographic, weather, geographical, and cultural conditions. Resources also vary from one state to another.

For example, if you take Kashmir, it has extreme cold, while a southern state has its own weather conditions, they are hot. The same scheme designed for both won’t serve the purpose. That’s where the government of India should think. Instead of designing centrally sponsored schemes on their own, the amount should be earmarked and given to the states to design schemes suitable to them. So that money given to them can be properly spent. Otherwise, you are designing the schemes unilaterally and those schemes are applicable to all the states in the same way.


AA: A lot of people argue that states like Telangana or Karnataka contribute much more to the central pool, while some economists say that if Telangana gives Rs 100, it gets back only Rs 35 in the devolution scheme. So what would be ideal?

(MB): That's what you know in fact you might have seen the number of economist statements also whatever you are giving from the state you have to get the same to the extent of 5% this side that side to the extent of that same share to come expects you to come back to the state proportionately but unfortunately when you are giving 100 rupees you are getting only 30 35 rupees it is it definitely it leads to a lot of heartburn. So that is where we represented number of times also to the government of India. See to that you know whatever you are pulling whatever you are contributing see to that we get the same amount equal amount so that there'll not be any you know heartburn. 

MB: That’s what I’m saying. In fact, you might have seen statements by a number of economists. Whatever a state gives, it should get back the same amount, with a margin of 5% this side or that. That proportionate share should come back to the state.

Unfortunately, when you give 100 rupees, you get only Rs 30–35. It definitely leads to a lot of heartburn. That is why we have represented this issue to the government of India many times. Whatever you are contributing, see to it that we get the same equal amount, so that there is no heartburn.

AA: A certain issue has come up from Telangana. The leadership is saying that central schemes like Ayushman Bharat require the state government to contribute, but because of the high debt burden, many in Congress say it is difficult to implement central schemes when you already have your own social welfare schemes. What do you say?

MB: There should not be duplication of schemes. I made this very clear in the beginning. Some states have designed their own schemes. Implementing the same scheme again has very little impact.

Suddenly if you ask states to stop better schemes they are already running and adopt central ones that aren't exactly what was there earlier, people won’t accept it. People will not be happy. It’s better to leave it to the states to design their own requirements.

Some states require more money for education, some for health, some for infrastructure, industry, agriculture, or social activities. It varies from state to state, because each has different geographical conditions, languages, and cultures. The Centre should understand that and allow states to do this.

For example, Telangana has a scheme called Rajiv Aarogyasri. Under it, each eligible family can get treatment worth up to Rs 10 lakh rupees a year, not just in government hospitals but also in corporate hospitals. It is a big scheme that has been running for a long time. In between TRS was their, of course. But earlier it was Rs 5 lakh; we made it Rs 10 lakh.

AA: So are you saying that implementation of central Ayushman Bharat would be a duplication?

MB: Not exactly. What we are implementing is much better and much wider. Families can get treatment worth Rs 10 lakh a year, even in corporate hospitals.

AA: So you would like to focus on your own state schemes?

MB: Exactly. For example, Indiramma Housing. For homeless people, we are giving nearly Rs 5 lakh for a house. We have been doing that in our state.

AA: And the Centre’s scheme is much less than that, under PM Awas Yojana...?

MB: Yes. You must appreciate the people of the respective states. Let them design and plan what is suitable. The Centre should give its share and let them design and plan, then monitor whether states are spending on that purpose.

AA: Recently, Jairam Ramesh, the Congress spokesperson, alleged that two semiconductor companies, one in Karnataka which was forced out to set up its factory in Gujarat, and one which wanted to come to Telangana, but was forced out to Andhra Pradesh. Could you elaborate?

MB: As you know, Hyderabad, Telangana, is very suitable for software and semiconductor industries – weather-wise, human-resource-wise, and because it is already a hub. For decades, Fab City and chip manufacturing were being developed. People had been discussing and planning. Suddenly, those companies that wanted to come here were pushed to other states.

AA: Do you think this was for political reasons?

MB: Obviously. Other states have their own interests. But pushing them away is against Telangana’s interests, which is not correct. Telangana is also part of this country, and it contributes significantly to the GDP of the country.

AA: When I spoke to people in Telangana before this interview, many asked me to raise two issues: Bhudharati and Hydra. They said these have created confusion – Bhu Bharati in land records, and Hydra in real estate. Do you have a response?

MB: No, no. Bhu Bharati is much sought after in Telangana. The previous TRS government bought Dharani software, which created a lot of chaos among landowners. Telangana’s landholding system is very different from other states.

During the 1940s and early 1950s, there was the peasants’ armed struggle in Telangana – farmers fought for rights to land. After independence, Congress governments brought the Tenancy Act and later the Telangana Tenants Act, giving farmers rights to the land they tilled. Then came land reforms in the 1970s.

But the TRS government changed earlier records and brought in Dharani, restoring the names of old landlords from before land reforms and removing farmers’ names. This created chaos.

We promised during the elections that Dharani would be scrapped. We brought in Bhu Bharati, discussed it in the assembly, and passed it. Now things are being set right.

AA: And Hydra?

MB: Hydra is not illegal. I don't know why people are spreading rumours. It protects land meant for the public—lakes, parks, and other community assets. These were being encroached on by individuals. Hydra safeguards them. They are not doing illegal things, they are trying to protect the legal property of the city and society. It also works on traffic control, rescue operations, and disaster management.

AA: Finally, sir, what are your government’s priorities in the next few years? The Congress promised a list of deliverables during the elections, some of which have been fulfilled and some not. As finance minister and deputy CM, which sectors will be your focus?

MB: Our priorities are education and health. Telangana is largely a city state, with urbanisation growing rapidly. We are also focusing on infrastructure, which supports wealth generation, the software industry, pharma, nutraceuticals, and other clusters.

We are planning the regeneration of the Musi River, like the Thames in London. Hyderabad has the Musi, but it has been treated like a drain. We want to make it a fresh-water river again, with parks and development along its banks.

We are also building a “future city” with AI technology, an AI university, and advanced infrastructure.

In agriculture, we are giving a bonus of 500 rupees per quintal of paddy over the MSP. For housing, 4.5 lakh houses have been sanctioned under Indiramma Housing, each costing Rs 5 lakh. We provide free power to 29 lakh pump sets, 200 units of free power to BPL families, free bus rides for women, Rs 500 gas cylinders, and fee reimbursement for students.

We are also building integrated residential schools of international standards on 25-acre campuses, fully residential, English-medium, and including teaching staff. These will be a gamechanger and role models for the country. We are also working on skill universities and advanced technology centres.

AA: Corruption was a major issue with the previous government, because of which people voted for you. Have you been successful?

MB: We are streamlining everything so that corruption cannot happen.

AA: Thank you so much, sir, for speaking with The Wire. That was Mallu Bhatti Vikramarka, deputy CM and finance minister of Telangana.

This article went live on September fifth, two thousand twenty five, at fifty-four minutes past seven in the morning.

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