The ‘Special Category Status (SCS)’ for Bihar and Andhra Pradesh have been the long-standing demand of Janata Dal (United) and the Telugu Desam Party (TDP) respectively – the two allies of the BJP-led-National Democratic Alliance (NDA) at the Centre.
A State with ‘Special Category Status’ becomes eligible for tax cuts and preferential central government assistance. Although the Indian Constitution does not provide for such categorisation, the provision was first introduced by the National Development Council (NDC) of the Planning Commission in 1969.
Three States, namely, Jammu and Kashmir, Assam and Nagaland were accorded SCS in that year. Over the next 41 years, more 8 States were added to the list. These included Tripura, Arunachal Pradesh, Mizoram, Manipur, Meghalaya, Sikkim, Uttarakhand and Himachal Pradesh.
Bihar is not eligible for Special Category Status
The decision to accord ‘Special Category Status’ to these States was based on the following 5 criteria:
- Hilly and difficult terrain
- Low population density and/or sizeable share of tribal population
- Strategic location along borders with neighbouring countries
- Economic and infrastructural backwardness
- Non-viable nature of State finances.
Once a State is accorded SCS, it becomes eligible for 90% of Central government funds in the case of schemes sponsored by the Union government. In contrast, non-SCS States get only 60% of the funds from the Centre.
The Special Category Status issue was first addressed in the National Development Council (NDC) meeting in 1969. During this meeting, the D R Gadgil Committee introduced a formula to allocate Central Assistance for state plans in India. Prior to this, there was no specific… pic.twitter.com/3q4zGbzF1k
— Amit Malviya (@amitmalviya) July 22, 2024
Moreover, States with ‘Special Category Status’ get more tax concessions and additional revenues from the Centre.
The National Development Council noted in 2012 that Bihar did not fulfil any criteria, which would justify its categorisation under ‘SCS.’ This was re-affirmed by the Minister of State for Finance, Pankaj Chaudhary.
Political blackmail and non-existent SCS
JD(U) supremo Nitish Kumar has cited the economic backwardness, poor human development indicators, frequent natural disasters, insufficient water for irrigation, and loss of industries to Jharkhand to rationalise the demand for SCS for Bihar.
This is despite the fact that Bihar’s GDP growth for 2022-2023 was 10.98%, which was higher than the national average.
Similar demands have been made by NDA ally, N Chandrababu Naidu-led-TDP, in the past for the State of Andhra Pradesh. He had even pulled out of the NDA alliance in 2018 after the Narendra Modi government did not give in to his political blackmail.
It must be mentioned that the Centre dissolved the Planning Commission and the National Development Council in 2014-2015 and replaced it with NITI Aayog.
Essentially, the Special Category Status of 11 States ended with that decision. As such, there is no provision now to accord SCS to Bihar, Andra Pradesh any State for that matter.
It now remains to be seen as to how the JD(U) and TDP arms twists the Centre and whether the BJP comes out on top.
