The NDA Govt on Wednesday Sep 07,2016 announced a financial package for Andhra Pradesh that
includes full funding of Pollavaram irrigation project, tax concessions
and a special assistance, but stopped short of giving the state a
special category status.
Andhra Pradesh, which financially suffered because of creation of
separate state of Telengana in June 2014, will get a railway zone as
also all cost incurred on the irrigation part of Pollavaram project from
the date it was declared a National Project on April 1, 2014 will be
funded by the Centre.
Citing constraints placed by the 14th Finance Commission in grant of
special category status to Andhra Pradesh, he said an amount equivalent
to what that categorication would have fetched, would be given to the
state in form of a Special Assistance Measure for five years.
This will be in form of form of externally aided project, he said,
adding the state would also get two tax concessions, details of which
will be notified by the CBDT shortly.
Andhra Pradesh has been demanding a Special Category State (SCS) status
from the Centre ever since the state’s economic powerhouse Hyderabad,
which housed several IT and pharmaceutical companies as well as PSUs,
went to Telengana in the bifurcation.
Running a revenue deficit and no capital to boast of, a special status
would have given the state preferential treatment in getting central
funds assistance and tax breaks.
While the Andhra Pradesh Reorganisation Act does not mention of SCS for
the state, the then Prime Minister Manmohan Singh had on the floor of
Rajya Sabha on February 20, 2014 promised to grant the status to the
state for five years.
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