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Bihar Chief Minister Nitish Kumar on Monday again raked up the issue of special category status for his state, accusing the Centre of putting the Raghuram Rajan panel report on the issue on the back burner.
“The demand for a special status for Bihar and the model of governance being pursued by the state that encompasses key social indicators, like education, health and basic infrastructure like roads, will be made an issue in the coming elections,” Kumar said at an event organised by industry chamber Assocham here.
Accompanied by Cabinet colleagues Renu Kumari Kushwaha and Prashant Shahi and Janata Dal (United)’s Rajya Sabha member of Parliament N K Singh, Nitish Kumar said his state’s demand for a special status not only had the backing of Biharis but also an expert panel under the chairmanship of Rajan, now the Reserve Bank head.
The Congress might ally with the Rashtriya Janata Dal (RJD) for the Lok Sabha polls. The JD(U) leader refused to comment on the possibility of the Congress forging an alliance with the RJD, led by bete noire, Lalu Prasad.
Rajan’s report, made public in September, proposed an index of backwardness composed of 10 equally weighted indicators for monthly per capita consumption expenditure, education, health, household amenities, poverty rate, female literacy, percentage of Scheduled Castes and Scheduled Tribes, urbanisation rate, financial inclusion and physical connectivity.
Of the 28 states, 10 scored above 0.6 (out of one) on the composite index and were to be classified as least developed, 11 states scoring from 0.4 to 0.6 were less developed and seven scoring less than 0.4 were relatively developed.
Bihar came as the second least developed state after Odisha.
The report recommended that each state get 0.3 per cent of overall central funds allocated and of the remaining 91.6 per cent, three-fourths be allocated based on need and a fourth on improvement in performance, to be reviewed every five years.
The panel was set up in May, in the wake of demands from various states for a special category status, for deciding central fund allocations.
The government asked Rajan, then the finance ministry’s chief economic advisor, to head a panel with the task of suggesting indicators of the relative backwardness of states, to enable a better allocation.
Central allocations are governed by what is know as the Gadgil-Mukherjee formula. It places substantial emphasis on a state’s population, followed by factors such as per capita and literacy, besides fiscal management.
Kumar said, “Although we were not completely satisfied with the Raghuram Rajan report and our members gave a dissent note, still, there was enough in the report for enabling a special dispensation for Bihar…. However, after showing some positive signs, it has been kept in cold storage.”
Economist and social scientist Shaibal Gupta, a member of the panel, had disagreed with the recommendations. Gupta had disagreed on monthly per capita consumption expenditure, instead of per capita income, as suggested by the finance minister in his Budget 2013-14 speech, being a component.
Kumar said his party had been building public pressure by holding several rallies in Patna and Delhi for its demand from the Centre, and it would continue to do so. The special status would enable the state to attract more investment because of tax concessions and also because the mandatory share of the state in central schemes would be increased considerably, leaving it with more resources.
The Bihar chief minister also hit out at the Bharatiya Janata Party’s prime ministerial nominee, Narendra Modi, without naming him. He said in an environment of elections, the public discourse was being changed with people being taken on the garden path and being fed with pipe-dreams. “It is being projected as if for everything — from our border problems with China, Pakistan and Bangladesh to growth — there would be a magic wand which would solve the issues.”
Again, without naming anyone, he talked about the political atmosphere in Bihar where “people are behaving as they have returned from jail for fighting a freedom movement.”
Taking on the current model of the Planning Commission, the Bihar chief minister said states should be allowed to devise their own schemes of development since each state has a “unique strength and the schemes in one state cannot be replicated in another…. But the Centre wants to do that.”
Inviting the captains of industry for investment in the state, the chief minister advised them just “to focus on investment in Bihar and the state would offer them the best of facilities.”
“The demand for a special status for Bihar and the model of governance being pursued by the state that encompasses key social indicators, like education, health and basic infrastructure like roads, will be made an issue in the coming elections,” Kumar said at an event organised by industry chamber Assocham here.
Accompanied by Cabinet colleagues Renu Kumari Kushwaha and Prashant Shahi and Janata Dal (United)’s Rajya Sabha member of Parliament N K Singh, Nitish Kumar said his state’s demand for a special status not only had the backing of Biharis but also an expert panel under the chairmanship of Rajan, now the Reserve Bank head.
The Congress might ally with the Rashtriya Janata Dal (RJD) for the Lok Sabha polls. The JD(U) leader refused to comment on the possibility of the Congress forging an alliance with the RJD, led by bete noire, Lalu Prasad.
Rajan’s report, made public in September, proposed an index of backwardness composed of 10 equally weighted indicators for monthly per capita consumption expenditure, education, health, household amenities, poverty rate, female literacy, percentage of Scheduled Castes and Scheduled Tribes, urbanisation rate, financial inclusion and physical connectivity.
Of the 28 states, 10 scored above 0.6 (out of one) on the composite index and were to be classified as least developed, 11 states scoring from 0.4 to 0.6 were less developed and seven scoring less than 0.4 were relatively developed.
Bihar came as the second least developed state after Odisha.
The report recommended that each state get 0.3 per cent of overall central funds allocated and of the remaining 91.6 per cent, three-fourths be allocated based on need and a fourth on improvement in performance, to be reviewed every five years.
The panel was set up in May, in the wake of demands from various states for a special category status, for deciding central fund allocations.
The government asked Rajan, then the finance ministry’s chief economic advisor, to head a panel with the task of suggesting indicators of the relative backwardness of states, to enable a better allocation.
Central allocations are governed by what is know as the Gadgil-Mukherjee formula. It places substantial emphasis on a state’s population, followed by factors such as per capita and literacy, besides fiscal management.
Kumar said, “Although we were not completely satisfied with the Raghuram Rajan report and our members gave a dissent note, still, there was enough in the report for enabling a special dispensation for Bihar…. However, after showing some positive signs, it has been kept in cold storage.”
Economist and social scientist Shaibal Gupta, a member of the panel, had disagreed with the recommendations. Gupta had disagreed on monthly per capita consumption expenditure, instead of per capita income, as suggested by the finance minister in his Budget 2013-14 speech, being a component.
Kumar said his party had been building public pressure by holding several rallies in Patna and Delhi for its demand from the Centre, and it would continue to do so. The special status would enable the state to attract more investment because of tax concessions and also because the mandatory share of the state in central schemes would be increased considerably, leaving it with more resources.
The Bihar chief minister also hit out at the Bharatiya Janata Party’s prime ministerial nominee, Narendra Modi, without naming him. He said in an environment of elections, the public discourse was being changed with people being taken on the garden path and being fed with pipe-dreams. “It is being projected as if for everything — from our border problems with China, Pakistan and Bangladesh to growth — there would be a magic wand which would solve the issues.”
Again, without naming anyone, he talked about the political atmosphere in Bihar where “people are behaving as they have returned from jail for fighting a freedom movement.”
Taking on the current model of the Planning Commission, the Bihar chief minister said states should be allowed to devise their own schemes of development since each state has a “unique strength and the schemes in one state cannot be replicated in another…. But the Centre wants to do that.”
Inviting the captains of industry for investment in the state, the chief minister advised them just “to focus on investment in Bihar and the state would offer them the best of facilities.”
| Rajan's index |
| Least developed states |
| Odisha |
| Bihar |
| Madhya Pradesh |
| Chattisgarh |
| Jharkhand |
| Arunachal Pradesh |
| Assam |
| Meghalaya |
| Uttar Pradesh |
| Rajasthan |
| Note: The rankings are in the descending order. Odisha is the least developed state, followed by Bihar and so on. |
| Source: Raghuram Rajan Committee report on evolving a composite development index of states |
