Notwithstanding its claim to have extended unprecedented financial assistance to the State, the sharp “U-turn’ taken by the BJP on its commitment to give the Special Category Status (SCS) for 10 years is likely to deal a severe blow to its electoral prospects. The BJP had neither fought for inclusion of the SCS in the A.P. Reorganisation Act, which might have forced the UPA-II to concede the SCS for five years nor taken remedial steps after coming to power in 2014.
The SCS, a special financial package for the backward districts on the lines of the ones given for the Koraput - Bolangir - Kalahandi region in Odisha and Bundelkhand in Uttar Pradesh, bridging the fiscal deficit for 2014-15 and tax incentives for promoting industries prominently figured in the BJP manifesto and stands out as a promise completely disregarded by the NDA government.
While the BJP maintained that its hands were tied by certain procedural difficulties, the TDP too did a volte-face by passing a resolution in the Assembly praising Prime Minister Narendra Modi for giving Special Assistance Measure (SAM) in lieu of the SCS and subsequently reviving its demand for SCS on the pretext that the Central funding was grossly inadequate.
Finance Minister Arun Jaitley had reportedly said the SCS existed at the time of the bifurcation but was abolished as per the recommendation of the 14th Finance Commission (FC), which clarified that it had nothing to do with the SCS.
The dispute culminated in the break-up of the BJP-TDP alliance and the SCS continued to be a sensitive issue and consistently topped the agenda in the Assembly. It was eventually described by the BJP’s top leaders as ‘a closed chapter’.
In the Assembly, Chief Minister Chandrababu Naidu observed: “Citing the constraints of the 14th FC’s recommendations, Union Finance Minister announced SAM, stating all ingredients of SCS would be made available with it. It was informed that after the introduction of the GST, the assistance and incentives offered to the SCS States would lapse. The State government expected that SAM would be implemented in letter and spirit on par with the other special category (northeastern and hill) States. However, the Centre extended assistance to the special category States in August 2017 and gave a new industrial incentive package for the N-E States in March 2018 but did not extend the same to A.P.”