Vijayawada: In a dampener to the argument of AP leaders including Chief Minister N. Chandrababu Naidu, Y.S. Jagan Mohan Reddy and Pawan Kalyan, the Centre on Friday said special category status (SCS) does not provide for industrial incentives. These leaders have been stating that with SCS industries will queue up to set up shop in the state that will fast pace economic growth due to the industrial incentives it provides.
Union planning minister Rao Inderjit Singh on Friday told the Rajya Sabha that the 11 states that had been enjoying SCS were only being given deficit grant, 90 per cent funding on externally aided projects and centrally sponsored schemes and that there were no industrial incentives. He was replying to a question by BJP member, G.V.L. Narasimha Rao.
“Special category status for plan assistance was granted in the past by the National Development Council to some states that were characterised by a number of features necessitating special consideration,” Union planning minister Rao Inderjit Singh said. The special status did not provide for any specific industrial incentives, he said. The 11 states are Aruna-chal Pradesh, Assam, Himachal Pradesh, J&K, Manipur, Meghalaya, Miz-oram, Nagaland, Sikkim, Tripura and Uttarakhand.
Telangana state Chief Minister K. Chandra-sekhar Rao has opposed giving any industrial incentives under SCS to AP, stating that industry would shift from the state to AP. Union planning minister Rao Inderjit Singh said the eight northeastern states and the three Himalayan states of Jammu & Kashmir, Himachal Pradesh and Uttarakhand were provided higher Central share compared to other states for Centrally sponsored schemes.
This has been implemented from fiscal 2016-17. The funding pattern for the majority of Centrally sponsored scheme (CSS) for the eight northeastern states and the three Himalayan states is in the ratio of Centre:State of 90:10 whereas, for the rest of the states it is 60:40 between. For Externally Aided Projects (EAPs) the loan received by the Centre is passed on as 90 per cent grant to the eight northeastern and three Himalayan states whereas, for the other states it is a pass-through assistance as a loan.
“As the Fourteenth Finance Commission recommendations for 2015-2020 provided for increased share in the devolution of taxes from 32 per cent to 42 per cent, block grants like Normal Central Assistance (NCA), Special Plan Assistance (SPA) and Special Central Assistance (untied) provided to special category states earlier have been discontinued from 2015-16, which were admissible to the eight northeastern states and three Hima-layan states,” Mr Singh told the Rajya Sabha.
