Committed to giving Andhra Pradesh a special package

Finance Minister Arun Jaitley said that Centre is committed to give Andhra Pradesh a special package equivalent to a special category state. Talking to a news agency, the union minister also said that govt. has been endlessly waiting for the state government to revert on mechanism of receiving it.

Jaitley said the modalities of giving the special package were agreed way back in September 2016 but the state government only in January this year suggested a change in route of receiving funds, to which the Centre agreed but has not heard from it ever since.

The Telugu Desam Party, which has 16 MPs in the 545-member Lok Sabha, first pulled out its ministers from the Narendra Modi government and recently decided to quit the alliance itself.

Jaitley said the modalities of giving the special package were agreed way back in September 2016 but the state government only in January this year suggested a change in route of receiving funds, to which the Centre agreed but has not heard from it ever since. The Telugu Desam Party, which has 16 MPs in the 545-member Lok Sabha, first pulled out its ministers from the Narendra Modi government and yesterday decided to quit the alliance itself. The party, which is in power in Andhra Pradesh, had been demanding greater financial assistance to make up for the disadvantage it has been put to since its division in 2014. Jaitley, however, said the Centre has been fully committed to giving the promised funds to the state and there has been no delay on its part. He said the so-called special category status cannot be given to Andhra Pradesh in its literal sense after implementation of the award of 14th Finance Commission, which deals with sharing of central government’s financial resources with the states.

The constitutionally-mandated Commission gave increased share of states fund in central taxes to 42% from 32% previously and meeting revenue deficit in case any state needs to be extraordinarily compensated.

The minister said a special category state gets to pay just 10% share of the money to be spent on a centrally sponsored scheme in comparison to general category states having to pay 40%. The remaining 90% in case of special category states and 60% in general category states is borne by the Centre. The 30% equivalent advantage that the special category states had was agreed to be given to Andhra Pradesh for five years.

Andhra Pradesh, he said, suggested that this should come to it in form of external aided projects wherein the repayment is 90% borne by the Centre and 10% by the state.