Here are the latest updates on this story:
In a largely symbolic exercise, the state assembly passed by voice vote the Chief Minister's resolution rejecting the Telangana bill. The resolution said the bill seeks to divide the state without any reason or consensus and "ignores the very basis of creating Andhra Pradesh, the first linguistic state of independent India."
Though the assembly's vote does not matter, the rejection poses an ethical question for the Centre and the President. It is the President's prerogative to clear the bill for discussion and vote in Parliament in the session that starts on February 5. Sources say he is likely to consult legal experts on his next step.
"The bill was sent for comments and not a vote. The assembly resolution will not affect anything," said Digvijaya Singh.
The Congress will find it hard to muster support among other parties to push the bill through. Sources say the government has begun discussions with BJP to ensure bipartisan support for the bill that proposes to divide Andhra Pradesh and turn the 10 districts of Telangana into India's 29th state.
Pro-Telangana leaders said the resolution was expected, and "not even worth the paper it was printed on." "By February 15, Parliament will pass the Telangana bill, I have reliable information. Delhi is determined," said K Chandrasekhara Rao, leader of the Telangana Rashtra Samiti.
Kiran Kumar Reddy has dared his own party and said he will quit politics if the bill is introduced in its current form in Parliament. Over 9,000 amendments were proposed in the bill during discussions in the state assembly.
This is the last time that Parliament will meet before the national elections, so if the Telangana proposal is not cleared, Andhra Pradesh will be undivided for the national polls.
That will rescue politicians like the Chief Minister who belong to the non-Telangana regions of Rayalaseema and Coastal Andhra, which will form the residuary state.
A Group of Ministers will meet on February 4 to discuss strategy to ensure that the Telangana bill clears the Parliament test.
Residents of "Seemandhra" as the two regions are together referred to, are worried about receiving less water and power than they have so far. Telangana has been arguing for decades that its resources are unfairly exploited by Seemandhra.