Hours after Union Finance Minister Arun Jaitley ruled out “special status” to Andhra Pradesh, TDP leader and Chief Minister N Chandrababu Naidu Wednesday night announced that the party was pulling out its two ministers from the BJP-led government at the Centre. The TDP, he said, would decide later over its continuance in the NDA though the Centre’s attitude was “very hurtful and insulting”.
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“As a matter of courtesy, I tried to inform Prime Minister Narendra Modi… It is my responsibility as a coalition partner to inform the Prime Minister about our party decision. My OSD spoke to his OSD but the Prime Minister was not available,’’ Naidu said.
The TDP announcement came within hours of Jaitley declaring that the Centre was willing to provide the “monetary equivalent” of a special-category state to Andhra Pradesh but would not be able to grant it “special status” which was restricted only to the north-eastern and three hill states by the 14th Finance Commission.
Following a teleconference with TDP MPs, senior ministers and MLAs, Naidu said he was forced to take the decision after watching the attitude of Jaitley who dismissed Andhra’s demand for special category status as a “sentimental and political movement’’ which could not be accommodated constitutionally.
“I went to New Delhi to meet PM and central ministers 29 times in the last four years. I showed a lot of patience, but we were taken very lightly all the time. The Centre is behaving as if we are greedy to get a lot of money from the Centre which does not belong to us. We are only asking for what is rightfully ours and what has been provided for in the Andhra Pradesh Reorganisation Act, 2014. But Jaitley is projecting it as if we are asking for money at the expense of the country’s Defence budget,” he said.
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“The attitude of the Centre towards Andhra Pradesh has been very hurtful and insulting. Resignation of the two Union ministers is the first step. We will take a call on whether to stay with NDA as a partner or not when the time comes. We have always cooperated with the Centre but the spirit of cooperative federalism is missing,’’ Naidu said.
Earlier in the day, the Chief Minister told the Andhra Pradesh assembly that there was no question of compromise on the issue and he would continue to fight to protect the interests of the state.
“Time and again, we have told the Centre that Andhra Pradesh needs help because after bifurcation we have been suffering due to revenue loss. I have gone to Delhi 29 times but to no avail. I am anguished over the denial of special status to Andhra Pradesh. What is this humiliation and injustice to the state? It is a matter of self-respect of Andhra people and the Centre should fulfil the assurances made during bifurcation of the state,’’ he said.
Jaitley said he agreed with the assessment that Andhra Pradesh was suffering financially after Telangana was carved out of the state. He said the government would honour each and every commitment made by the Centre at the time of bifurcation. “Obviously, when the division took place, AP was unwilling, Telangana wanted the division. And Andhra was suffering in terms of resources and, therefore, some resource assistance had to be given to Andhra Pradesh,” he said.
Asked why the Centre has not provided more funds to the state which had been witnessing a political backlash on the issue, Jaitley said: “Political issues cannot increase the quantum of money because the Centre has no free-floating funds. Every state in India has the right to the central fund in the same manner.”
On Naidu’s demand for fulfilling the promise of granting special status, he said such a category did exist when the state was bifurcated in 2014. But after the implementation of the 14th Finance Commission award, such a treatment was “constitutionally” restricted to just the north-eastern and three hill states.
“Now one of the promises was that at that time (of bifurcation), a special category status could be given to AP. At that time, concept of special category states did exist. But when the 14th Finance Commission report came in, a constitutional award, they said there is no special category status that can now be given. Instead states which are deficit in terms of revenue, we are compensating them. Because everyone gets a hike of 10 per cent to 42 per cent, plus for a certain period revenue deficit will be taken care of. And a provision for revenue deficit was made in the case of Andhra Pradesh,” he said.
After the 14th Finance Commission award, the Centre shares 42 per cent of its taxes with states as against 32 per cent earlier.
Asked about Congress president Rahul Gandhi’s promise to give the state the special category status if his party is voted to power, Jaitley said, “I still have to follow the constitutional award” of the 14th Finance Commission. “Sentiment does not decide quantum of funds, it is the constitutional award of the Finance Commission which decides the quantum of funds that the states get,” he said.
For special status category states, the Centre pays 90 per cent of the funds required in a centrally-sponsored scheme as against 60 per cent in case of normal category states, while the remaining funds are provided by the state governments.
For Andhra Pradesh, the Centre is committed to giving 90 per cent of the funds, equivalent to special category states, through other means like external agencies, he said.
The Centre is also willing to accept the state government’s suggestion of raising funds through NABARD. At meetings with the state government last month, the Centre suggested creation of a special purpose vehicle (SPV) where NABARD could give the money so as not to upset the fiscal deficit of the state, Jaitley said, adding that the Andhra Pradesh government was yet to come back on the modalities of this proposal.
On meeting the revenue deficit of the state, he said the Centre had already paid around Rs 4,000 crore and only Rs 138 crore remained.