NDC approval must for special status to Seemandhra

HYDERABAD: Does the 'special category status' accorded to the residuary state of AP by the Union Government have enough legal cover or has it been done for mere public consumption ahead of elections?

Serious questions in this regard are arising if one goes by the comments of the Planning Commission and the Law Ministry in respect of this proposal. The move to grant special category status, as is known, was made at the last minute ' after the AP Reorganisation Bill was passed by the Lok Sabha and before it was considered by the Rajya Sabha ' and formed part of the 'assurance' given by Prime Minister Manmohan Singh towards addressing the 'concerns of Seemandhra.'

Subsequently, the PM's statement on the floor of the Rajya Sabha was found to be insufficient and the Union Cabinet, which met on March 2, considered bringing in an ordinance, amending the Reorganisation Act.

Apart from changes pertaining to inclusion of more villages in Bhadrachalam division in Seemandhra, the Cabinet was said to have cleared an amendment to incorporate the 'special category status' clause in the Act.

Though the Cabinet cleared the ordinance, reliable sources told that officials concerned have not moved it forward, apparently, aware of likely complications. In other words, it has not been sent to the President and with the elections announced, such a step may not be possible at all.

The original clause 46 of the bill provides for the following:

1) The award made by the 13th Finance Commission to the existing State of AP shall be apportioned between the successor states by the Central government on the basis of population and other parameters and the President shall make a reference to that effect;

2) Notwithstanding anything in Section 1, the Central government may, having regard to the resources available to the successor State of AP, make appropriate grants and also ensure that adequate benefits and incentives in the form of special development package are given to backward areas of that State;

3) The Central government, while considering special package for the successor State of AP, provides adequate incentives, in particular for Rayalaseema and north coastal regions of that State.

After all these concessions were made in the bill, the ordinance sought to add an extra clause (46A), which reads: 'Without prejudice to the provisions contained in Section 46, on and from the appointed day, the successor State of AP shall be given special category status for a period of five years.'

But, what are the views of the Planning Commission? Going by the comments appended to the Cabinet note, the Commission clearly opined that the process to fulfil the PM's assurance on grant of special status 'needs to be aligned with the existing procedure for grant of such a status for the following reasons.'

Here, they are:

i) Grant of special category status has always been an executive decision endorsed by the National Development Council (NDC) since the beginning. It has never been a subject matter for legislation and there is no need to take this step in the present case.

NDC is a body comprising both Centre, States and UTs which approves five-year plans. The approach to Central assistance to States on Plan side is guided by NDC, chaired by the Prime Minister.

The Gadgil Mukherjee formula, which confers benefits that accrue to special category status, has also been approved by the NDC. Bypassing the NDC, therefore, may not be appropriate.

ii) When the States of Bihar, Uttar Pradesh and Madhya Pradesh were reorganised, Uttarakhand was granted special status. This was endorsed by the 49th meeting of the NDC held on Sept 1, 2001. The same procedure would suffice in the instant case.

iii) Several Parliamentary questions have been answered on behalf of the PM by the Ministry of Planning during the last five years reiterating the NDC criteria on special category status and the prerogative of only NDC to confer such a status.

It is, therefore, important that NDC endorsement is obtained for grant of special category status for the successor State of AP. There may be an issue of privilege if it is done in a manner other than the NDC route.

The Ministry of Law and Justice too concurred with the Planning Commission's view. In its note to the Cabinet, the ministry said: 'Special category status to states are generally granted on the recommendation of the NDC with the approval of the Cabinet.

The decision lies with the NDC which guides and reviews the work of the Planning Commission in that regard. Therefore, the administrative ministry may reconsider the proposal in consultation with the Planning Commission.'

Given this scenario, whether the NDC, which would, in any case, meet only sometime after the next government is in place will approve the proposal is a million-dollar question as, according to experts, it does not fit into the parameters/guidelines already laid down by the council. States like Bihar have already voiced their protest over the benefit sought to be conferred on the residuary state of AP.