India decides to carve new state after protest

HYDERABAD: India's government will carve a new state out of southern Andhra Pradesh - base for several major multinational corporations' operations - after violent protests, a move likely to fuel more statehood demands.

Regular protests demanding the new "Telangana" state, which would take 10 out of 23 districts of Andhra Pradesh, have shut down businesses in Hyderabad, the main city and home to firms like Microsoft, Google and Mahindra Satyam.

"The process of forming the state of Telangana will be initiated," Home (interior) Minister Palaniappan Chidambaram, told reporters early yesterday after hectic meetings.