NDA Allies Happy With Budget Dole. Wait Continues For Special Status

Finance Minister Nirmala Sitharaman presented the Union Budget on Tuesday which has made its allies Janata Dal (United) and Telugu Desam Party satisfied who despite not getting the ‘special status’ were allocated huge budgets.

Both Bihar and Andhra Pradesh governments have been fighting for ‘special status’ for the states.

Special Category Status or SCS is a classification given by the Centre to assist development of states that face geographical and socio-economic disadvantages.

The Constitution does not make a provision for SCS and this classification was later done on the recommendations of the 5th Finance Commission in 1969.

Bihar has been demanding the status ever since the findings from the “Bihar Caste-based Survey, 2022”, which revealed that nearly one-third of Bihar’s population continues to live in poverty.

However, Bihar got financial and industrial support in the Union budget and comes at a time when the state is getting closer to the Assembly polls, scheduled for 2025.

While the budget focussed on other aspects, the first post-poll Budget for Modi 3.0 saw the FM unveil major concessions for NDA-ruled Bihar and Andhra Pradesh, even though the two states were denied ‘special status’.

Post the budget announcement, Bihar Chief Minister Nitish Kumar, came out with a cryptic response to the Centre's refusal to grant special category status to the State.

"You will get to know all things slowly, and slowly (sab kuchh dhire dhire jaan jaaiyega)," the longest-serving CM of the State said, in reply to a volley of questions he faced from journalists at the Bihar Assembly.

However, JD(U) has said that they are happy with what they have got.

JD(U) spokesperson said that there was no point reading too much into the Centre not considering special status for the state. “Let the Opposition cry foul over it. The idea is to ensure development of Bihar. An annual package of Rs 1 lakh crore has made a good start for us,” he told Indian Express.

The Purvodaya project, which concentrates on development of the eastern region of the country, is among announcements expected to help the state.

Finance Minister Sitharaman announced that on the Amritsar-Kolkata Industrial Corridor, there will be an industrial node at Gaya, “which will serve as a good model for developing ancient centers of cultural importance to future centers of modern economy”.

The government will also support road connectivity projects, including Patna-Purnea Expressway, Buxar-Bhagalpur Expressway, Bodhgaya, Rajgir, Vaishali and Darbhanga spurs, and an additional two-lane bridge over river Ganga at Buxar at a total cost of Rs 26,000 crore.

Power projects, including setting up of a new 2400 megawatt plant at Pirpainti, will be taken up at a cost of Rs 21,400 crore. “New airports, medical colleges and sports infrastructure in Bihar will be constructed,” Sitharaman said.

Bihar will also be provided with additional allocation to support capital investments. “The requests of the Bihar government for external assistance from multilateral development banks will be expedited,” Sitharaman said.

Bihar, which has frequently suffered from floods has been allocated a budget of Rs 11,500 crore “for the Kosi-Mechi intra-state link and 20 other ongoing and new schemes including barrages, river pollution abatement and irrigation projects”.

Besides this, the Union government will support the development of Nalanda as a tourist center, and Nalanda university will be revived to its former “glorious stature”.

Nalanda will have a Saptarshi corridor clubbing Buddhist, Jain and other religious sites on the lines of the Ayodhya and Kashi Corridor. Gaya’s Buddhist pilgrimage site of Mahabodhi Temple will be also developed as a religious corridor, the minister said.

Meanwhile, Sitharaman announced that the government will allocate Rs 15,000 crore in FY25 and future years to develop the capital city of Andhra Pradesh and the state's infrastructure.

"Our government has made efforts to fulfil the commitments in the Andhra Pradesh Reorganisation Act. Recognising the state's need for capital, we will facilitate special financial support through multilateral agencies. In the current FY, Rs 15,000 crore will be arranged with additional amounts in future years," Sitharaman said while presenting the Union Budget 2024.

She also announced that the government is also committed to completing the Polavaram project, which is an under-construction multi-purpose irrigation project on the Godavari River in the Eluru District and East Godavari District in Andhra Pradesh. According to the Reorganisation Act of 2014, this venture, like Amaravati, will also receive financial assistance from the Centre.

She added that the government will provide essential infrastructure such as water, power, railway and roads in the Koparthy Industrial Area under the Vizag Chennai Industrial Corridor (VCIC) and Hyderabad Warangal Industrial Corridor (HWIC).

Koparthy Industrial Area under Vizag Chennai Industrial Corridor (VCIC) is proposed along with the southern node of Tirupati and Nellore. The 235 km Hyderabad Warangal Industrial Corridor (HWIC) extends along NH 163 between Hyderabad and Warangal, the two most important economic hubs of the state of Telangana.

Funds would also be allocated for the development of backward areas in Rayalaseema, the north Andhra districts, and the south Andhra district of Prakasam.

Andhra Pradesh chief minister N Chandrababu Naidu was happy with the budget and expressed his gratitude for “recognising the needs of the state” and commended this year's Budget as “progressive and confidence-boosting.”

“On behalf of the people of Andhra Pradesh, I thank the Hon'ble Prime Minister @narendramodi Ji and Hon'ble Union Finance Minister @nsitharaman Ji, for recognising the needs of our State and focusing on a Capital, Polavaram, industrial nodes and development of backward areas in AP in the union budget of FY 24-25. This support from the Centre will go a long way towards rebuilding Andhra Pradesh. I congratulate you on the presentation of this progressive and confidence-boosting budget. #APBackOnTrack”