India is renowned for being a democratic nation with the world's longest constitution. India's indigenous culture was carefully considered when its constitution was being drafted. Commissions like Special Category Status are added to assist the states in maintaining development and growth despite their diverse demographic and economic makeup.
Let us take a closer look at what is Special Category Status (SCS) as being sought by Bihar and Andhra Pradesh, alliance partner in NDA.
What Is Special Category Status (SCS)?
Special Category Status (SCS) in India is a designation conferred upon certain states by the central government based on specific criteria. This status provides these states with preferential treatment regarding financial assistance, resource allocation, and other benefits. The concept of Special Category Status was first introduced by the Fifth Finance Commission in 1969, aimed at addressing the developmental needs and challenges faced by certain states due to factors such as hilly terrain, difficult terrain, low population density, strategic location along borders, and economic backwardness.
The states that typically qualify for Special Category Status face geographical or socio-economic challenges that hinder their development. These challenges may include hilly and difficult terrain, inadequate infrastructure, a low resource base, and significant tribal or marginalized populations. The benefits of Special Category Status include preferential treatment in allocating central funds, tax breaks, subsidies, and assistance for infrastructure development.
States That Have Acquired SCS
Several states in India have sought Special Category Status over the years, citing various reasons such as underdevelopment, geographical constraints, and socio-economic backwardness. Some of the prominent states that have demanded special category status include:
Andhra Pradesh: Andhra Pradesh sought Special Category Status following the bifurcation of the state in 2014, which led to the creation of Telangana. The demand was primarily driven by the loss of the revenue-generating capital city of Hyderabad and the perceived economic disadvantages faced by the residuary state of Andhra Pradesh.
Bihar: Bihar has long advocated for Special Category Status due to its high population density, low per capita income, inadequate infrastructure, and persistent socio-economic challenges. The state government argues that Special Category Status would provide the necessary resources to accelerate its development and address issues like poverty, unemployment, and underdevelopment.
Odisha: Odisha has also demanded Special Category Status, citing its vulnerability to natural disasters, particularly cyclones. The state contends that Special Category Status would enable it to better prepare for and recover from such disasters, as well as address its broader developmental needs.
Assam: Assam has sought Special Category Status due to its complex socio-political landscape, including ethnic diversity, insurgency issues, and underdevelopment in certain regions. The state government argues that Special Category Status would facilitate greater investment in infrastructure, education, and healthcare to address these challenges.
How Is Eligibility Decided?
Despite these demands, the granting of special category status is ultimately decided by the central government based on the recommendations of expert committees and commissions. In recent years, the criteria for eligibility have become more stringent, and the central government has been cautious about extending Special Category Status due to concerns about its fiscal implications and potential impact on other states.
In some cases, states have had their demands for Special Category Status rejected by the central government, citing reasons such as inadequate justification, a lack of consensus among political parties, or concerns about the financial burden on the central exchequer. Additionally, the introduction of alternative schemes such as Special Assistance to States and the Finance Commission's recommendations for devolution of funds have provided avenues for addressing the developmental needs of states without necessarily conferring Special Category Status.
Recent Conversations About SCS
Following the General Elections, Chandrababu Naidu of the Telugu Desam Party and Nitish Kumar of the Janata Dal (United) have become significant figures in the formation of the central government. Their emphasis on securing special category status for Andhra Pradesh and Bihar has rekindled the debate on this important issue.
Special Category Status in India is a mechanism aimed at addressing the unique developmental challenges faced by certain states. While several states have demanded this status over the years, the decision to grant it ultimately rests with the central government, taking into account various factors including eligibility criteria, fiscal implications, and broader developmental priorities.
