GS / current affairs Hot 23Topic for BPSC UPSC : Special status argument and counter argument

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Prob Qs: Critically examine request of special state status to Bihar? Describe whether Bihar needs a special state status or not?

Update: 15 July 2011 also read GS topic 22

Movement started just after new government has been elected in 2005 and first memorandum has been produced to PM on 9 December 2005. This movement gained the momentum recently will CM flagged the 1.25 crs signed memorandum to Delhi.

Other state which has Special status are:

1. J&K 2. Himachal Pradesh 3. Uttrakhand 4. North- Eastern states like Nagaland, Assam Arunachal Pradesh etc.(more than 10 states now )

Bihar Rationale of request for special status grant from center:

1. After the division of Bihar on November 15, 2000, all the mineral resources have gone to Jharkhand’s kitty and the state is left with nothing. So it needs all the attention of the Centre.

2. Bihar is presently on the path of development under the chief ministership of Nitish Kumar. A special status to Bihar would not only foster the growth of the state, but also assist in the development of the country.

Core rationale:

Basic rationale is demand coming from Bihar matches all the criteria set under Dr. Gadgil formula for special attention to a state:

Dr. Gadgil Formula(now also known as Dr. P.J Gadgil-Pranav Mukharjee)

Gadgil formula was evolved in 1969-(4^th five year plan) for determining the allocation of central assistance for state plans in India. It was adopted for distribution of plan assistance during Fourth and Fifth Five Year Plans.

According to this formula, allocation for states was based on 60 per cent of population, 10 per cent of per capita income, 10 per cent of tax effort, 10 per cent of on-going irrigation and power projects and the remaining 10 per cent of special problems. This formula was modified in 1980 and the modified formula was the basis for allocation during the Sixth and Seventh Five Year Plans. As per the modified formula, the total weightage for on-going schemes and per capita income was 20 per cent.

Criteria	Weightage (%) 1969	Weightage (%) (Gadgil- Mukharji formula)1991
Population	60	55
Per Capita Income	10	25
Fiscal Management(Tax  efforts)	10	5
Special Problems	10	15
Irrigation and Power	10
Total	100	100

Reference:

Benefits of Special state status:

1. Central grant will be 90% of total required sum of central assistance vs 30% grant and rest as loan to state

2. No lapse of central assistance for consecutive years. ( I personally not happy with this provision as it hamper the efficiency of fund utilization) .

3. Not used fund will amount for reduction/deduction in next allocation of funds to state. ( again not in favour of)

4.Tax benefits to those who invest in the state.( this one will be a major benefit to Bihar.)

Argument against the Bihar getting special status:

“The state would have to prove that it has spent all the funds and it requires more. Nitish Kumar was a powerful minister in the Union cabinet when the NDA was in power at the Center. Why did he not raise this issue at that time”-  Mehboob Ali Qaiser

Rebutting argument	Fund received from centre (2009-10)	Fund utilized
Indira Aawas  Yojna	Rs 4,484 crs, with a target of 10.98 lakh Indira Aawas	Rs 2,995 crs and completed only 6.53 lakhs Indira Aawas
Pradhanmantri Gram Sadak Yojna	To construct 3,000KM	And constructed 2,430.96 KM roads only
Additional Road project assigned	2,200 KM	Completed only 412.32 KM

reference: Bihar Government report card at my previous blog.

Jharkhand, Rajasthan and several other states also lagged behind on development front then how could Bihar be given special status?- Raj Babbar, Congress.

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