Bihar Chief Minister Nitish Kumar addresses the Bhim Sansad ceremony on the event of Constitution Day, in Patna.
| Photo Credit: ANI
The story to date: On November 22, the Chief Minister Nitish Kumar-led Cabinet handed a decision in search of the grant of particular class standing (SCS) to Bihar. The demand is available in the backdrop of the findings from the “Bihar Caste-based Survey, 2022”, which revealed that just about one-third of Bihar’s inhabitants continues to dwell in poverty.
What is a particular class standing?
It is a classification granted by the Centre to help the improvement of States that face geographical or socio-economic disadvantages. The SCS was launched in 1969 on the suggestion of the fifth Finance Commission (FC). Five elements reminiscent of (i) hilly and troublesome terrain (ii) low inhabitants density and/or sizeable share of tribal inhabitants (iii) strategic location alongside worldwide borders (iv) financial and infrastructural backwardness and (v) non-viable nature of state funds, are thought of earlier than granting SCS. In 1969, three States — Jammu & Kashmir, Assam and Nagaland — had been granted the SCS. Subsequently, eight extra States together with Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand got the SCS by the erstwhile National Development Council.
What are the advantages hooked up?
The SCS States used to obtain grants primarily based on the Gadgil-Mukherjee formulation, which earmarked practically 30% of the whole central help for States to the SCS States. However, after the abolition of the Planning Commission and the suggestions of the 14th and 15th FC, this help to SCS States has been subsumed in an elevated devolution of the divisible pool funds for all States (elevated to 41% in the 15th FC from 32%). Additionally, in the SCS States, the Centre-State funding of centrally sponsored schemes is divided in the ratio of 90:10, way more beneficial than the 60:40 or 80:20 splits for the basic class States. Besides, there are a number of different incentives accessible to the SCS States in the type of concession in customs and excise duties, revenue tax charges and company tax charges to draw investments to arrange new industries and many others.
Why is Bihar demanding the SCS?
The demand for SCS for Bihar has been made by varied political events of the State again and again. The poverty and backwardness of the State are argued to be due to the lack of pure assets, steady provide of water for irrigation, common floods in the northern area and extreme droughts in the southern a part of the State. Simultaneously, the bifurcation of the State led to the shifting of industries to Jharkhand and created a dearth of employment and funding alternatives. With a per-capita GDP of round ₹54,000, Bihar has constantly been one in all the poorest States. Highlighting the similar in his recent demand for SCS, CM Nitish Kumar, stated that the State is dwelling to round 94 lakh poor households and the granting of SCS will assist the authorities get about ₹2.5 lakh crore required to fund varied welfare measures over the subsequent 5 years.
Do different States additionally need SCS?
Since its bifurcation in 2014, Andhra Pradesh has requested for a grant of SCS on the grounds of income loss resulting from Hyderabad going to Telangana. Additionally, Odisha has additionally been requesting for the SCS, highlighting its vulnerability to pure calamities reminiscent of cyclones and a big tribal inhabitants (practically 22%). However, the Central authorities citing the 14th FC report, which made a suggestion to the Centre that no State be accorded the SCS, has repeatedly denied their calls for.
Is Bihar’s demand justified?
Although Bihar meets most of the standards for the grant of SCS, it doesn’t fulfil the requirement of hilly terrain and geographically troublesome areas, which is thought of to be the major motive for problem in infrastructural improvement. In 2013, the Raghuram Rajan Committee arrange by the Centre, positioned Bihar in the “least developed category” and prompt a brand new methodology primarily based on a ‘multi -dimensional index’ for devolving funds as a substitute of a SCS, which might be revisited to deal with the State’s socio-economic backwardness.
The author reads regulation at RGNUL, Punjab.