Mirage of ‘Special Category’ status

The Special Category status to residuary Andhra Pradesh appears to be an illusion, if one goes by the statement made by the Centre in Lok Sabha in the winter session, or at least, it may not be coming easy.

More so, with the disbanding of the Planning Commission, the sole authority for extending the special status, both the states may have to wait for some more months, till newly formed Niti-Aayog to come up with the new formula and agenda to fulfill the mandatory norms under the AP Reorganisation Act which was passed in February 2014
The special category status was announced by the previous UPA government while dividing the state, aiming at providing for revenue loss to residuary Andhra Pradesh. However, later even Telangana also demanded similar status.

Of course, Telangana and several other small states like Chattisgarh, Jharkhand, Uttaranchal and Haryana too have staked claim for the Special Category status which would exempt them from several economic, fiscal and regulatory prerequisites and labor and fiscal restrictions.

Caught in an environment of economic reinventing after a scam ridden regime of UPA, the Modi government is treading the patch very slowly and not keen to accept anything on dotted line, just because Parliament and past regime had okayed it.

That left both Telangana and AP governments high and dry. Both had expected a whale of financial support and procedural assistance from Center in the wake of bifurcation.

Even though Union Minister and Andhra BJP leader M Venkaiah Naidu has been oozing confidence that everything promised will be given, the present environment of Modi cabinet and its doings with fiscal apparatus of the country does not indicate any happy tidings. There are more indications suggesting Special Category status is not in sight, at least in the near future. For instance, Union Minister of State for Science and Technology, YS Chowdary maintains that the Centre is in the process of formulating a package for AP which include tax rebates, hinting that there may no grants in aid of the state.

According to critics, the Central government is not focusing to create infrastructure in Andhra Pradesh to facilitate relocation of the Capital City, but it is more inclined to its own schemes like Mega city, Smart City, Agriculture, IT, and manufacturing clusters under the 'Make in India' campaign.

Special Status Vs Special Category status

We generally use ‘Special Status’ as synonym to ‘Special Category status’. There are three principal differences between a “special category state” and a state with a “special status”.

First, the special status that J&K has is guaranteed by the Constitution of India and granted by Parliament with a two third majority.

Special category status is decided by an executive order and granted by the National Development Council (NDC), a creation of an administrative setup. Second, special status is empowered position of legislative power and political rights. As against this, a special category status is only an economic and administrative category with some fringe financial benefits.

Third, the power to grant special category status lies with the NDC, composed of the Prime Minster, Union Ministers, Chief Ministers and members of the Planning Commission.

As of now, there are 11 states enjoying both Special Status and Special Category Status - Arunachal Pradesh, Assam, Himachal Pradesh, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand.

Recently, some other states like Odisha, Rajasthan, Jharkhand, Bihar and Chhattisgarh, lately Telangana and Andhra Pradesh are waiting for a grant of Special Category status. The Special Category State status makes a State eligible to receive additional funds from the Centre.

To get the status, the states to have certain parameters like low resource base, hilly and difficult terrain, low population density or sizeable share of tribal population and strategic (hostile) location, in which neither Seemandhra nor Telangana qualifies.

Thus, now it is clear that the special category status will be decided by the Niti Ayog and with the NDA government planning to amend the AP reorganization Act, 2014, the question of grant of special status also hangs in air.

Both Telangana and AP are anticipating huge grants from the center for urban infrastructure - roads, power plants, irrigation projects and also creation of a new capital and water ways in AP. The anxiety of the new born states apart, the political gamble of the NDA government appears to make the development agenda of these states, part of its grandiloquent scheme of ‘Make In India’ and thereby it could exploit the resources and also drive its economic thrust as pilot studies.

By: KVVV Charya