Reviewing Rationale for Special Status

Opinion: Reviewing Rationale for Special Status

The demand for special status by states is as old as the creation of states in India. The way this provision has been misused or used as a tool by the Congress-led governments at the Centre raised questions over its validity. Everybody knows that many deserving states were denied the grants, while some states which failed to properly use their own resources were obliged. The latest demands from Odisha, Bihar, Seemandhra or other states should be seen in this context.

The concept of a special category status was first introduced in 1969 when the 5th Finance Commission sought to provide certain disadvantaged states with preferential treatment in the form of central assistance and tax breaks. At that time three states Assam, Nagaland and J&K were granted special category status, but later on eight other states—Arunachal Pradesh, Himachal Pradesh, Manipur, Meghalaya, Mizoram, Sikkim, Tripura and Uttarakhand—were also granted that status because they all are situated in the Himalayan region.
During the UPA-II regime, the states like Bihar, Odisha and Tamil Nadu, citing their backwardness, also demanded special status. The Centre constituted a six member expert committee under the chairmanship of Raghuram G Rajan (presently RBI Governor) in May 2013 to consider backwardness of the states for evolving a composite development index of states. The committee submitted its report on September 2, 2013. It evolved an under-development index/need index based on ten indicators—monthly per capita consumption, education, health, household amenities, poverty rate, female literacy, percentage of SC/ST population, urbanisation rate, financial inclusion and connectivity.
The Committee recommended that the states, which score 0.6 and above on underdevelopment index are ‘least developed’ states, states that score below 0.6 and above 0.4 are ‘less developed’ states, while the states that score below 0.4 are ‘relatively developed’ states. The 10 ‘least developed’ states currently scoring above 0.6 could be targeted for specific additional support. These states are Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Meghalaya, Odisha, Rajasthan and Uttar Pradesh.
A committee member Dr Shaibal Gupta gave a note of dissent while raising some valid questions on the methods for selection of indicators and construction of the index. According to him, index is faulty hence the report did not present a true picture. The flaws of Rajan Committee Report can be understood on the basis of under-development index alone. As per this index, Gujarat by scoring 0.49 points, falls in less developed states category and at the same time Mizoram scoring 0.49 points also falls in the same category. Can Gujarat and Mizoram be at par on development counts? In the same way J&K scores 0.50 points. Can anyone explain how Gujarat and J&K are equal on development grounds? Not only this, Sikkim by scoring 0.43 points and Tripura by scoring 0.47 points, are much ahead from Gujarat. It is clear that this Report was prepared with a hidden agenda—to counter the popular ‘Gujarat model’. The UPA later awarded Rajan for this ‘wonderful task’ by making him RBI Governor.
After the formation of new government at the Centre, more states are demanding special status. Hence, it is necessary to re-examine the backwardness index of states so that every State can get fair share of funds from the Centre. If even a single State lags behind, the country cannot become prosperous or developed nation.
While backwardness is considered as parameter for allocation of funds, the States’ own efforts and achievements should also be considered for it. They too should work hard. Parameters for fund allocation should be based upon reward and punishment. As of now the states get funds from the Centre, but they don’t use that properly.
States affected by communal violence can be punished. As of now it makes no difference for funds allocation. Even states get special funds in the name of rehabilitation of riot victims. If the states get special funds for communal violence too, why would they try to curb them?
-Dr Ravindra Agrawal(The writer is a senior journalist)