The central government on Monday reiterated its stand that Bihar will not be given special category status. Nitish Kumar-led JD(U), a key constituent of Narendra Modi’s National Democratic Alliance, recently passed a resolution demanding special category status, or a special package, for the state. Now, opposition parties like the RJD have attacked Chief Minister Nitish Kumar and demanded his resignation.
The National Development Council (NDC) has in the past given “special category” status for scheme assistance to states with certain characteristics which require special consideration. Citing an inter-ministerial group report prepared in 2012, the central government said there was no basis to grant this status to Bihar based on existing factors.
“The decision has been taken after taking into consideration all the factors and the special situation of the state. Earlier, Bihar’s request for special category status was considered by the Inter-Ministerial Group (IMG), which submitted its report on March 30, 2012. The IMG concluded that based on the existing NDC criteria, there is no basis for seeking special category status for Bihar,” Minister of State for Finance Pankaj Chaudhary said in a written reply to the House on the first day of the monsoon session.
Replying to a question by JD(U) member Rampreet Mandal, Chaudhary said the existing criteria include hilly or difficult terrain, low population density or a significant share of tribal population, strategic location along the border with neighbouring countries, economic and infrastructural backwardness, non-viable nature of the state’s finances etc. He added that the decision was taken taking into consideration all the above factors holistically along with the peculiarities of the state.
But the government has previously maintained that the 14th Finance Commission report rules out the possibility of granting special category status to any more states, which would include tax cuts for beneficiary states and increased funding from the central government.
A day before the start of the session when Finance Minister Nirmala Sitharaman will present the Union Budget on Tuesday (July 23), the JD(U), YSRCP and BJD demanded special category status for Bihar, Andhra Pradesh and Odisha, while Jairam Ramesh of the Indian National Congress said, “strangely, the TDP has remained silent on the issue.”
It was the ruling NDA and the opposition INDIA alliance that demanded in a cross-party meeting that Bihar be given special category status, seconded by BJP ally Sanjay Kumar Jha of JD (United) and Union Minister Chirag Paswan of LJP (Ram Vilas). The RJD also joined the demand. But Jha said if special status was not possible, a special financial package could also be an option.
“The Constitution does not provide for such a classification.”
Amit Malviya, a senior Bharatiya Janata Party leader, said no additional states would be given special category status as there is no provision for such classification in the Indian Constitution. He added that while the distinction between general and special category states was abolished with the 14th Finance Commission in 2015, the net tax payable by states was increased from 32% to 42% between 2015 and 2020.
The issue of special category status was first raised at the National Development Council (NDC) meeting in 1969. At this meeting, the DR Gadgil Committee introduced a formula for allocating central aid to Indian state schemes. Prior to this, no specific methodology existed… pic.twitter.com/3q4zGbzF1k — Amit Malviya (@amitmalviya) July 22, 2024
“…the 15th Finance Commission maintained this rate at 41% for the periods 2020-2021 and 2021-2026, with a 1% adjustment due to the creation of the Union Territory of Jammu and Kashmir. The adjustment is aimed at addressing the resource gap in states through devolution of taxes and in cases where tax devolution alone is not able to cover the assessment gap, a post-devolution revenue shortfall grant is provided…Currently, special category status has not been granted to additional states as the Constitution of India does not provide for such classification,” he said in an X post, explaining the background to special category status and how grants based on the Gadgil Commission formula were abolished after 2015.
Bihar Congress leader and MP Akhilesh Prasad Singh said, “Ever since Nitish Kumar became the Chief Minister, he has been raising the issue of special status for Bihar. If there is no such provision, it should be amended. You are in power so why are you misleading the people? The Government of India should take this decision as soon as possible in the interest of Bihar.”
#WATCH | Commenting on the government’s response to the special category status, Bihar Congress leader and MP Akhilesh Prasad Singh said, “…Ever since Nitish Kumar became the Chief Minister, he has been raising the issue of special status for Bihar. If there is no such provision, then amend the provision. You… pic.twitter.com/Xe2hecbiRp — ANI (@ANI) July 22, 2024
Replying to RJD leader Lalu Yadav’s demand for Kumar’s resignation, Singh further said, “We have been hearing this demand (special status) ever since Kumar became the Chief Minister in 2005. Kumar has been raising the issue at every meeting. Kumar will be the Chief Minister for 20 years. The people of Bihar should not be fooled. This demand should be fulfilled at the earliest.”
Meanwhile, Janata Dal(U) MP Devesh Chandra Thakur said, “There will continue to be demand for special status… How the state will develop, how it will get investments, all this needs to be seen by the central government.”
(With input from relevant agencies)
