Hyderabad, July 31 (IANS): After over three years of uncertainty, the Information Technology industry here heaved a sigh of relief with Tuesday's announcement by the Congress party to carve out a separate Telangana state out of Andhra Pradesh.

The announcement has cleared the air over the future of Hyderabad, a major IT destination in the country.

This fast growing metropolis will be the joint capital of Telangana and Andhra Pradesh for 10 years. Andhra Pradesh is expected to build its own capital within that period.

The IT industry welcomed the decision, saying it brought an end to uncertainty and brightened the prospects of the city attracting new investments.

The industry with software exports to the tune of Rs.40,000 crore was worried over frequent shutdowns and spells of violent protests for separate Telangana state. This had taken sheen off brand Hyderabad.

"I believe the decision has brought in a positive sentiment as the uncertainty surrounding the matter has finally been resolved," said V. Laxmikanth, managing director, Broadridge India.

"Hyderabad, known for its large pool of talented IT professionals and as a base for leading MNCs, is expected to reclaim its reputation of being the destination of choice for businesses across industries," he said.

B.V.R. Mohan Reddy, chairman and managing director, Infotech Enterprises, said while he was not for or against the decision, he was anxiously looking forward for this decisive movement.

"The separation problem has been voiced for the last 50 years but in the last three years some of these agitations have been (hurdles) for progress of the state. The uncertainty has slowed down the growth. That is now past."

Suman Reddy, vice president and managing director, Pegasystems India, hoped the development will bring back stability in the business environment of the city.

"Growth and expansion from the perspective of IT MNCs investing in the state had been stalled/relatively slow due to this issue, which hopefully will resume after the decision is announced," he said.

Hyderabad, which emerged on the world IT map only in mid-1990s, is home to over 1,000 IT and ITeS companies including global majors like Microsoft, Google, Facebook, Dell, Oracle and Amazon.

The IT and ITes sector provides nearly five lakh jobs.