"You will appreciate that under the existing criteria for approval by the National Development Council, Odisha does not qualify for grant of Special Category Status," Planning Commission Deputy Chairman Montek Singh Ahluwalia said in a letter to Patnaik.
Ahluwalia described the state's finances as stable and viable with sound indicators of fiscal deficit, outstanding liabilities and interest payments to total revenue receipt.
The Planning Commission deputy chairman said the state's demand has been examined with regard to existing criteria.
"Odisha does not satisfy the criterion of hilly and difficult terrain although forests in some areas do pose some difficulties," he said.
Pointing out that the proportion of tribal population in the state was relatively high compared to general category states, but lower than several special category states, he said, "The criterion of strategic location along international borders is not satisfied."