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Nitish meets PM, seeks special category state status for Bihar

Last Updated: Tuesday, February 15, 2011 - 17:59

New Delhi: Ahead of the annual budget, Chief
Minister Nitish Kumar on Tuesday met Finance Minister Pranab
Mukherjee seeking "special category state" status for Bihar
and allotment of over Rs 3100 crore for it under Backward
Region Grant Fund special plan in 2011-12.

Seeking special status for his state on par with Himachal
Pradesh, Uttaranchal and the North-Eastern states, Kumar said
this will help attract private investment and reduce the
burden on the state where currently the government is the
predominant engine for development.

Kumar also expressed concern at the dwindling share of
Bihar in the 13th Finance Commission grants ruing "despite the
high development deficit, the share of the state of Bihar has
been reduced in the 13th Finance Commission (FC) award."

He said, "from 11.028 per cent of tax devolution in the
12th FC, the share has come down to 10.917 per cent in the
13th FC. Thus the 13th Finance Commission`s award has
seriously undermined the concept of equity and nationally
comparable public services in the state. This deficit must be
compensated with special grants."

In his memorandum to Mukherjee, Kumar said that the state
requires fund to the tune of Rs 3145.43 crore in the coming
financial year for completing on-going schemes under Backward
Region Grant Fund.

Besides, he also sought a special annual BRGF assistance
of Rs 4,000 crore during 12th Plan for the state arguing that
Bihar`s historically large development deficit needs to be
shared between the Central and the state governments.

Kumar also called for reducing the number of
Centrally-sponsored schemes saying their requirements for
state`s shares pre-empt the state governments` discretion to
use their resources as per their own needs and compel the
states to adopt `one size fits all` schemes.

"There is a need to drastically reduce the number of
CSSs and instead devolve funds allocated to different sectors
in consultation with the states," he said.

Kumar also urged the Centre to expedite the decision
regarding Bihar`s dues estimated to over 5000 crore to be
received from Jharkhand as per Bihar Reorganisation Act, 2000.

He noted that a strict adherence to the fiscal deficit
limit of three per cent for the financially disciplined states
like Bihar limits its market borrowings at the time it needs
the resources most. He said, "The states with low income, but
revenue surplus, should be given a chance to avail of more
borrowings for increasing their developmental expenditure".

Kumar also sought an enhancement in the ceiling of
borrowing for Bihar in 2011-12.


First Published: Tuesday, February 15, 2011 - 17:59
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