What's special about special status or special category or special package? Even as the angry Telugu Desam Party MPs, Ashok Gajapathi Raju and Y.S. Chowdary, have resigned from the Union cabinet because Andhra Pradesh has not been given 'special category' status, there is a lot of confusion as leaders, analysts and others bandy the word 'special' with three different suffixes.
Finance Minister Arun Jaitley explained that the quantum of funds to Andhra Pradesh under the special package will be the same as given to 'special category states', which do not exist post the report of the 14th Finance Commission. But that has made no difference to the demand for 'special category' for Andhra Pradesh.
The only state in the country to have a 'special status' is Jammu and Kashmir, under Article 370 of the Constitution. For any other state to get a similar status will require a Constitutional amendment, and is not in the realm of the possible in today's India.
On the contrary, the Constitution did not come into the picture in the case of “special category states”(SCS). The National Development Council, under the now abolished Planning Commission, which allocated Central assistance, felt that some states needed to be helped in their developmental efforts.
The criteria the council zeroed in was geographic isolation and inaccessible hilly terrain; borders with other countries and strategic location along the national borders; distance from large markets, low population and largely tribal communities at that; poor resource base and economic and infrastructure backwardness and generally states that would be financially non-viable.
The states that got the SCS tag were Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Jammu and Kashmir, Himachal Pradesh and Uttarakhand. These states together got 30 per cent of the total Central assistance, on the basis of what the government of the day called the 'Gadgil-Mukherjee formula'—it just meant they got some weightage.
But many other states found reason to ask for a similar status, and even more. Through the years of militancy, and thereafter, Punjab which has over 500km of fenced international border, and was putting up a brave fight against terrorists supported by the ISI in Pakistan, wanted lakhs of crores. Bihar, battling acute poverty and lack of opportunities, too sought special status. There was a feeling that states were lobbying for the status, leading to the formation of a committee under former RBI governor Raghuram Rajan in 2013.
The 14th Finance Commission meanwhile raised the devolution of funds to states, from 32 per cent to 42 per cent, though it subsumed much of the Central projects, which the states now had to continue on their own steam. The residual Central funds, it said, would be distributed among states for special projects, with the Centre paying 60 per cent and the states 40 per cent.
While the SCS as a category of states would be dropped, the states of the northeast and the three hill states would get 90 per cent by way of Central assistance for the special projects—30 per cent more than the others. These states' own share in these projects would be only 10 per cent, compared with 40 per cent in the case of others.
In the meantime, the committee under Raghuram Rajan said the SCS would find their need for funds met “more than adequately” by the basic allocation by the 14th Finance Commission. The committee proposed the idea of categorising states as 'least developed'—something that would have been terrible for states at a time they were all trying to woo private investors. With the Centre's funds after allocation to states now reduced, the benefits to SCSs would be minimal, it said, adding that states with special problems are better off seeking a special package.
Jaitley explained that the government was committed to giving Andhra Pradesh 90 per cent—as was being given to former SCS, as a special package.
During the debate on the Reorganisation of Andhra Pradesh Act in February 2014, then prime minister Manmohan Singh had said the SCS would be “extended to the successor state of Andhra Pradesh for a period of five years.” While his government did not do anything to implement it, the former prime minister's reply in Parliament is what buoyed the regional parties of Andhra Pradesh, which is not the only state demanding the special category status for itself.
Bihar—that lends the first letter to the word 'BIMARU' states, meaning sick or economically backward states—has long been asking for it, along with demanding Central money for development.
Post the floods, Chief Minister Nitish Kumar has been pressing even more. Soon after he dropped out of the 'Mahagathbandhan' and was sworn in as chief minister of an NDA government in July 2017, Kumar has queered the pitch some more, seeking Rs 2.75 lakh crore as a 'special package'.
JD(U) spokesperson K.C. Tyagi reminded the media then that Prime Minister Modi had promised a special package of Rs1.25 lakh crore to the state when he campaigned during the Assembly elections. “Now, since we have the same alliance ruling at the Centre and in the state, we expect that a Bihar package will be announced soon. Bihar's 'Achche Din' are round the corner,” he declared.
Odisha Chief Minister Naveen Patnaik has his own reasons for seeking a special package for the state that does not have an international border or difficult terrain.
As recently as last month, Punjab Chief Minister Amarinder Singh told Home Minister Rajnath Singh that Punjab had a long international border, which was in part due to the rivers they had to protect, a hostile neighbour and the volatile border. The state needs a special package, he told the BJP leader, as the two sat at a border post in Hussainiwala in the border district of Ferozepur in Punjab.
The chief minister followed it up with a visit to NITI Aayog vice-chairman Rajiv Kumar and handed a formal note.
Jaitley emphasised that he was waiting for Andhra Pradesh to tell the Centre in which account to send the money. But this would not be as a special category state—the two words around which the Assembly elections and the Lok Sabha elections in 2019 in Andhra Pradesh will be fought. The Telugu Desam Party and the YSR Congress—as well as the Congress—would all like to claim before the voters that they have got special category status for Andhra Pradesh.
The BJP, whether alone or with TDP as an ally, will simply talk about whatever the Centre has done for the state. What has to be specially noted, is semantics.