The uproar in Andhra Pradesh over the Centre’s refusal to give special category status (SCS) to the state is uncalled for. The state’s clamour for more central funds is understandable. After bifurcation, Andhra lost out on revenues since Hyderabad, the economic hub of the united state, went to Telangana. The loss of Hyderabad also meant Andhra, which was opposed to the bifurcation, had to build a new capital. A devastating cyclone in 2014 followed by droughts in the past two years have added to the state’s burden. A generous Centre alone can help the state tide over the fiscal crisis and the SCS status, promised in Parliament by the then UPA government which introduced the AP Reorganisation Bill, 2014, was the signal Andhra expected as vindication of the Union government’s commitment to the promise. Though the AP Reorganisation Act does not mention SCS for Andhra, the Modi government has reiterated that the promised Central assistance will be extended to the new state, rendering the SCS demand more of a political slogan than a real grievance. The opposition in Andhra has amplified this grievance since it is a handy issue to embarrass the ruling Telugu Desam, which is a constituent of the NDA.
The argument for SCS lost steam when the Modi government accepted the 14th Finance Commission’s recommendations, which suggested a new revenue sharing-plan for the Centre and the states. With a 10 per cent jump in the flow of Central revenues to states, the policy of extending special category state status, which facilitated transfer of funds in excess to the Finance Commission recommendations, had to be done away with. Besides, the Centre has unambiguously stated that it will provide special funds and grants for projects — the Polavaram irrigation project, for instance — crucial to Andhra’s economic development and tax concessions to attract investment. In fact, Union Finance Minister Arun Jaitley clarified that the special assistance from the Centre to Andhra will be as much as it would have got as an SCS state.
Andhra politicians should invest their energy in maximising the state’s advantages and stop playing victim. The state has a long coast with potential for developing ports and harbours and well-developed river deltas. It has an agrarian and industrial base that can be nurtured. The focus of the opposition must be on ensuring timely delivery of Central funds, execution of projects and scrutiny of state expenditure. The state needs to move on and consolidate its strengths, not look behind and whine.