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Process for changing the name of a state can be initiated by state itself.
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However, by virtue of article 3 of Constitution, Parliament has power to change name of state even if such proposal does not come from the concerned state.
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If initiated by state assembly, it will first pass a resolution for such change and this passed resolution will be sent to Central government (Union Home Ministry).
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Then Union Home Ministry prepares note for Union Cabinet for amendment to Schedule 1 of Constitution.
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Thereafter, Constitution Amendment Bill is introduced in Parliament under Article 3 of Constitution, which has to be approved with simple majority, before President gives his assent to it.
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Thereafter name of state will be changed.
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The example of such change is change in name of Orissa to Odisha.
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The Government of Orissa initiated this change in 2008 when it forwarded resolution passed by State Legislative Assembly to Union Government to change name of state from Orissa to Odisha.
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This bill was passed by Parliament as Orissa (Alteration of Name) Act, 2010 to rename state.