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India Unrest Puts 21 Million in Dark as Google Threatened

By Rajesh Kumar Singh and Sharang Limaye
October 09, 2013 11:22 AM EDT 15 Comments
Supporters of United Andhra Pradesh
Supporters of United Andhra Pradesh

Protests against a plan to split a southern Indian state entered a fourth day, leaving about 21 million people without electricity as outages threatened to affect technology companies like Google Inc. (GOOG) and Microsoft (MSFT) Corp.

Striking workers shuttered power plants and impeded distribution, extending blackouts that started Oct. 6 in six districts of Andhra Pradesh. The protesters oppose Prime Minister Manmohan Singh’s move last week to divide the state before national elections due by May.

“It’s as if the world has come to a standstill,” Buchi Babu Tanuku, who works with a local daily newspaper in the state, said by phone from West Godavari district. “Everyone’s staying indoors as there’s nothing much to do.”

The standoff risks disrupting the power supply to an area about the size of Spain that holds 20 percent of the country’s 1.2 billion people. The division will help Singh’s Congress party win some seats in the newly created state of Telangana as it pushes to extend its nine-year rule, according to N. Bhaskara Rao, chairman of the New Delhi-based Centre for Media Studies.

“The situation is becoming worse as there is no leader there having some credibility to tackle the problem,” Rao said. “This mess will not subside before the election. Protests will continue in one way or other.”

Employee Talks

The striking employees have declined Chief Minister N. Kiran Kumar Reddy’s request to return to work, A. Satya Rao, his press secretary, said by phone from Hyderabad. Talks with the employees will continue tomorrow after failing to yield any results today, he said.

Mobs this week have thrown stones at police, set tires on fire and damaged buses in Seemandhra, which will remain part of Andhra Pradesh. The protesters want the state to keep Hyderabad, India’s sixth-largest city that will fall in Telangana.

The city, home to offices of Microsoft, Google and Facebook Inc. (FB), will function as the common capital for both states for a period of 10 years, according to the decision by Singh’s cabinet. Control of Hyderabad is a key reason behind the protests, Reddy told CNN-IBN television news channel on Oct. 6.

Hyderabad has seen a three-hour daily power cut as about 60,000 utility workers have stayed home to protest the new state, according to a top official in the local government’s electricity department who requested anonymity as he isn’t an authorized spokesman. That has removed 3,600 megawatts of generation capacity, or 20 percent of the state’s total, he said.

Grid Risk

Failure to contain the demonstrations may prompt further distribution cuts to sustain a power grid that connects all of southern India. Talks with the labor unions of state power plants are on to prevent a repeat of last year’s collapse of the northern power grid that left an area inhabited by almost half of the population without electricity.

“Everything is intact,” said G. Anbunesan, chief of disaster management in the region at Power System Operation Corp., which operates the grid. “So far, there’s no problem.”

In the worst case, authorities would have the option of isolating Andhra Pradesh from the southern grid, according to Debasish Mishra, head of energy practice at Deloitte Touche Tohmatsu India Pvt. in Mumbai.

“Because of the blackouts, the load has already gone down significantly,” he said. “As long as they are able to match the demand and supply, the grid should be fine.”

Representatives of Google and Dr. Reddy’s Laboratories said the companies have yet to be affected. The government has provided extra security to Tech Mahindra Ltd. (TECHM), controlled by Mahindra & Mahindra Ltd. (MM), India’s biggest maker of tractors and utility vehicles, Aashish Washikar, a spokesman, said by phone.

‘Self-Flagellation’

“We have had no interruptions due to power cuts or any other factors,” Carson Dalton, head of corporate affairs at Facebook India, said by phone. “It’s business as usual.”

Outside of Hyderabad, the situation is becoming dire. Offices, schools and universities have closed. Private hospitals are running on generators, and non-critical surgeries have been postponed. Streets are almost empty as petrol stations are shut.

“Food prices are rising as supply is going down,” Patri Rajasekhar, who sells mobile-phone SIM cards, said from Nellore, one of the affected areas. “It’s like self-flagellation.”

The 50-year-old campaign for Telangana’s statehood got new life in December 2009 when Singh’s government backed the idea as a local leader’s hunger strike triggered protests that closed roads and offices. The government made little effort to finalize the plan as demonstrators for and against the new state clashed on the streets.

India created three new states -- Jharkhand, Uttarakhand and Chhattisgarh -- in 2000. The country has 28 provinces and seven union territories that are administered by the central government.

To contact the reporters on this story: Rajesh Kumar Singh in New Delhi at rsingh133@bloomberg.net; Sharang Limaye in Hyderabad at slimaye@bloomberg.net

To contact the editor responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net

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