Y Satyanarayana

Right from 2014 when Andhra Pradesh was hastily carved into two Telugu-speaking states, YSRCP president and currently Leader of Opposition in AP, YS Jagan Mohan Reddy has been waging a continuous struggle for Special Category Status to the state. SCS is an emotive issue all over Andhra Pradesh, as YS Jagan's mass outreach initiative Praja Sankalpa Yatra has revealed so far, in the seven districts that the walkathon has moved through. YS Jagan, on his part has been educating the masses on the imperative need for SCS to AP.

So, what exactly is Special Category Status?

To put this in some kind of perspective, it must understood that certain states in the country have historically been at a disadvantage. As per the decision taken by the National Development Council, a wing of what used to be the Planning Commission, Special Category Status to states at a relative disadvantage, is predicated on a number of reasons such as economic backwardness, hilly and difficult terrain and living conditions, inadequate availability of minimal infrastructure, and meagre state finances (due to the inherent disadvantage it faces), among other things.

The first state to be considered worthy of SCS was Jammu & Kashmir. Over the years, ten more states were added to the list. In 2010, Uttarakhand was the last to join the states to whom SCS was granted. As a cursory glance at the list reveals, most of the states are either hill states or at a historical disadvantage, in terms of several facets of socio-economic backwardness.

What does SCS Bring in Its Bag?

Among the big incentives AP would get, are special assistance grants from the Centre. Also, the state would get a wide range of other important advantages including excise duty concessions and other tax benefits, assistance for externally aided projects and lower state share in centrally sponsored schemes. Logically, all these benefits would attract investments and generate jobs.

Why did Andhra Pradesh insist on Special Category Status in the first place?

The promise of development as a natural corollary all the factors outlined here, would have turned SCS into an engine of growth for Andhra Pradesh. The vestigial state found itself at a disadvantage on account of the hastiness with which undivided Andhra Pradesh was bifurcated. Overnight, the state found itself stripped of its capital for six decades—Hyderabad. Though on paper, as per the AP Reorganisation Act, Hyderabad was to be the joint capital for ten years, the proposal was not quite viable for a number of reasons. For one thing, the differences between the political leaders of AP and Telangana, which had been simmering for decades and sharpened by the agitation for a separate state, made it difficult for the capital to be in one city, or have separate administrative set-ups even if they were to be technically under the governor.

It was Prime Minister Manmohan Singh who told the Rajya Sabha at the time of the division of the state that SCS would be given for 5 yrs to AP, and the current Vice-President, Venkaiah Naidu, had emphatically asked for ten, saying that 5 years would be insufficient given the circumstances in which the state was divided.

The 14th Finance Commission stepped in, as Arun Jaitley pointed out and modified this reasoning arguing that in its allocations and corresponding distribution of funds, it had factored the level of backwardness of states. The underlying logic therefore, was that if there were inequalities between states, distribution of central funds took care of the issue. Special Category Status was thus ruled out. It was also argued that states (such as AP) would be compensated through revenue deficit grant. However, Jaitley remained clear on one aspect—he remarked that the Centre would help AP by giving the state a special package which would match, in financial terms, Special Category Status. The Centre was also committed to bearing about 90% of the share of Centrally sponsored schemes. Significantly, Jaitley pointed out that Rs 4,000 crore had been granted to Andhra Pradesh to cover its revenue deficit. He added that only Rs 138 crore remained to be released.

It is clear however, that in spite of all the quibbling and jugglery, a special package is not the same thing as Special Category Status. As YS Jagan Mohan Reddy, the Leader Of Opposition in AP Legislative Assembly has repeatedly emphasized, SCS to AP is the only Sanjeevini, the only magic cure that can extricate itself from the economic morass it finds itself in. Whether the Centre is listening to the voice of the people of Andhra Pradesh, is another question.