New Delhi: The Centre on Thursday took the first significant step towards creation of a separate Telangana state from out of Andhra Pradesh and decided that Hyderabad will be the joint capital of the two states for 10 years.

Over two months after the Congress Working Committee put its seal of approval, the Union Cabinet approved the proposal of the Home Ministry for creation of the 29th state and decided to set up a Group of Ministers (GoM) to work out modalities.

Home Minister Sushilkumar Shinde. PTI Home Minister Sushilkumar Shinde. PTI “The Cabinet has given its approval for the creation of a new state of Telangana,” Home Minister Sushilkumar Shinde told reporters after the meeting that lasted more than two hours. He said it was decided that Hyderabad will be the common capital of the two bifurcated states for 10 years.

After the creation of the new state, the security and guarantees including fundamental rights of the people of coastal Andhra, Rayalaseema and Telangana will be ensured, he said.

The Cabinet approved a GoM that will go into the issue of a special financial disbursement that may be required from the central government for the residuary state of Andhra Pradesh, for building its capital and to cater to special needs of the backward regions.

The new state will have a geographical area of 10 of the 23 districts of undivided Andhra Pradesh. Today’s decision brings to fruition the announcement made by the then Home Minister P Chidambaram on December 9, 2009 for creation of Telangana. According to sources, the Prime Minister, who listened to all the views, said Congress as well as UPA have already taken a call on the creation of Telangana so there was no need to cause further delay on it.

Reiterating the committment to the creation of the separate state, Singh also assured the government will see to it that all the issues related to coastal Andhra, Telangana and Rayalseema are properly addressed.”

The issue was discussed for close to one and half hours in the meeting and Singh asked all ministers to give their opinions. Raju and Rao, who opposed the decision, argued that after the bifurcation, Andhra Pradesh will become the poorest state in the country as most of the resources would be left for Telangana region, including Hyderabad which is the most developed and prosperous city in the region.

However, Union Ministers S Jaipal Reddy, who hails from Telangana region, and Jairam Ramesh countered them saying that with the bifurcation, both the states will develop and the decision of the CWC cannot be altered. NCP chief and Union Minister Sharad Pawar said the creation of Telangana is a must and recalled that his party had supported its creation in 2004.

Union Minister and RLD chief Ajit Singh, who strongly supported the Telangana decision, also used the occassion to pitch for a separate state of Harit Pradesh to be carved out of parts of Western UP. A release by the government said the GoM, whose setting up has been approved by the Cabinet, will work out the “various legal and administrative measures to ensure the safety and security of the residents of all the regions” of the state including the guarantee of the fundamental rights.

“The GoM will also work out the modalities for the provision of special financial disbursements required for the setting up of a new capital for the residuary State of Andhra Pradesh and to meet the special needs of the backward regions and districts of the two states,”it said. Talking to reporters after the decison, Reddy said “I am very happy.

The people of Telangana had been demanding a separate state for the last 60 years and we are grateful to the UPA government as well as Congress party. I am hopeful that the bill for the creation of Telangana will be passed in the winter session.”

Replying to a question about the protest by some of his colleagues from Seemandhra region to the decision, he said “a strong agitation is going on against the creation of Telangana state in the Seemandhra region and being the representatives of people there, the ministers have reflected that sentiment.”