NE CMs insist on special category status
Source: The Sangai Express / Courtesy TNN

Guwahati, May 16 2015 : Chief Ministers of the seven northeastern States and Sikkim have jointly adopted a reso-lution to oppose any move by the Centre to abolish the special category status to the backward states, which will deprive them from receiving huge additional central funds.

The Chief Ministers have submitted their resolution to Prime Minister Narendra Modi urging his "intervention for taking remedial measures" .

All these States have non-BJP Governments except Nagaland, where BJP is a partner of the Nagaland People's Front-led Democratic Alliance of Nagaland government.

Assam, Arunachal Pradesh, Mizoram, Manipur and Meghalaya are ruled by Congress, while Tripura has a CPM Government and Sikkim is ruled by the Sikkim Democratic Front.

Map of North East India

There are 11 states, which are clubbed in the special status category.

The tag was first given to the three states of Assam, Jammu & Kashmir and Nagaland in 1969 after the Fifth Finance Commission recommended additional assistance to some disadvan- taged States in the form of central assistance and tax holidays.

At present, Arunachal Pradesh, Assam, Himachal Pradesh, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand have the special category tag.

The resolution said, "After analyzing the 14th Fi- nance Commission recommendations and the Union budget for 2015-16, it appears that the special cate- gory status of the northeastern region is going to be discontinued.

This will be nothing but a big blow to the interest of the region which has been suffering from backwardness and under-development since a long time" .

"The dangerous and disastrous move cannot be accep- ted at this stage.

The financial facilities availed by the northeastern states as special category states should be allowed to continue," it added.

Central funds are allocated to states by the erstwhile Planning Commission and now the NITI Ayog as normal central assistance (NCA), additional central assistance (ACA) and special central assistance.

The 11 special category states get 30% of the total NCA, which is the primary central assistance to states, while the remaining 70% is shared by the other states.

The special category states also get 90% of the NCA as grants and the remaining 10% as loan while the ratio for the general states is 30% loan and 70% grant.

Further, for the special category states funds are allocated on the basis of the state's plan size and previous plan expenditures while for the other states the allocation is determined by the Gadgil Mukherjee formula in which population, per capita income, fiscal performance and special problems are the guiding factors.

The resolution said, "The decision taken in the Union Budget of not to keep any provision under NCA, special plan assistance and special central assistance will drastically affect the finances of the NE states" .

The chief ministers have also resolved that the fund-sharing pattern for centrally sponsored schemes for the special category states should also be continued at the present ratio of 90:10 or wholly upgraded as grants.