VIJAYAWADA: The 15th Finance Commission, in its interim report, has made it clear that recommending special category status to states is not within its powers and put the onus squarely on the shoulders of the Union government.
In the report tabled in Parliament, the Commission said, “Some states have requested the grant of special category status. This does not constitute part of the mandate of the commission and remains entirely in the domain of the Union government which can take an appropriate decision after due consideration.”
The Commission, however, conceded that the issue of balanced and inclusive development of all states requires a more detailed assessment and assured that it will be fully addressed in its final report. The interim report is for the year 2020-21.
Of the total divisible pool of central taxes, the State’s share is fixed at 4.111 per cent.For Andhra Pradesh, the Finance Commission has recommended that it be given a revenue deficit grant of Rs 5,897 crore for the financial year 2020-21.
It is telling that 14 States face a combined post-devolution revenue deficit of Rs 74,340 crore and the Commission has recommended revenue deficit grants for the 14 States including Andhra. For Andhra Pradesh, the pre-devolution revenue deficit for 2019-20 is Rs 40,230 crore and for 2020-21, it is Rs 41,054 crore. The annual growth rate of the State is estimated to be 11.5 per cent for the year 2020-21, up from 10.6 per cent in 2019-20.
In a related development, to a query by TDP MP Kesineni Nani on whether the Finance Ministry is considering special category status to the State, Union Minister of State for Finance Anurag Singh Thakur informed the Lok Sabha that the class of special category states ceased to exist following the recommendations of the 14th Finance Commission and reiterated that the Centre provided special assistance measure in lieu of special status.
“The special assistance will be provided by way of repayment of loan and interest for the Externally Aided Projects signed and disbursed during 2015-16 to 2019-20 by the State,” he said.