Lok Sabha Question No. 97 (UNSTARRED), answered on 2018-02-02
Subject: Investments in Backward States
Ministry: FINANCE
Asked by: RAJESH RANJAN  (PAPPU  YADAV)

Government of India Ministry of Finance

Department of Economic Affairs

## LOK SABHA

## UNSTARRED QUESTION No. 97 2ND

## TO BE ANSWERED ON FRIDAY, THE FEBRUARY, 2018/MAGHA 13, 1939(SAKA)

## INVESTMENTS IN BACKWARD STATES

## QUESTION

## 97. SHRI RAJESH RANJAN

Will the Minister of FINANCE be pleased to state:

- (a) whether the Union Government is considering any special action plan to promote investments in the backward States like Bihar and if so, the details thereof;
- (b) whether Bihar has lagged far behind in development and needs to be moved forward; and
- (c) if s0, the steps considered to be taken by the Union Government? being

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SHRI PON. RADHAKRISHNAN)

(a) A special package of Rs.1.25 lakh crore was announced for Bihar in August 2015 for development in the State, with agriculture & farmer'$ wel education, skill development; health, electricity, rural development,  railways,  civil   aviation,  tourism,  petroleum natural gas, telecommunication and national highways identified as the core areas for funding: In addition, financial support of Rs. 40,657 crore was also approved for other investments in the State. fare, being

The Special Plan for Bihar was initiated in the tenth Five Year Plan (FYP) Period. At the time of the twelfth FYP some of the projects of the Special plan were still on-going: Accordingly, the Special Plan for Bihar was approved for continuation during the twelfth FYP with an allocation of Rs. 12,000 crore to meet the requirement of new projects (Rs 10,500 crore) as well as of on-going projects (Rs. 1500 crore). As against the allocation of Rs 12,000 crore for the twelfth plan, projects amounting to Rs. 11,088.33 crore were approved in the Empowered Committee Meetings. As against Rs. 11088.33 crore, an amount of Rs. 3717.78 crore was released till March; 2015. A that the programme became a part of the devolution; and an amount of Rs.1887.53 crore, Rs.1329.40 crore and Rs.2064.00 crore were released during FY 2015-16,2016-17 and 2017-18 respectively to the State Government of Bihar from the provisions made under Demand No. 37, 32 and 40 respectively for completion of on-going projects. Through the head of 'Special Assistance' under Demand No.40, Rs. 2064 crore was released during FY 2017-18 'to the State Govt: of Bihar under  Special Plan for Bihar (Backward Regions Grant Fund (BRGF)-State component) which is now considered as a part of On-going Prime Minister' $ package for Bihar -2015. fter

- (b) The Expert Committee under the chairmanship of Dr. Raghuram Rajan to measure backwardness of the Indian States had developed a multi-dimensional, Composite Development Index of States in its report submitted in September 2013. The report ranked Bihar as the second most backward State in the country.
- (c) Notwithstanding the fact that fundamental initiative for development of backward areas rests with has trying to address the problem of regional imbalances for faster and inclusive growth through higher devolution of funds as state share, central sector and centrally sponsored schemes etc. The special package to Bihar in 2015 was intended to bridge this development gap of Bihar and was designed to be over and above the on-going national social sector  schemes which covers Bihar viz. Mantri Samruddhi Yojana, MUDRA, Free LPG connections to BPL; Swachh Vidyalaya Abhiyan and so on: Further , 21 districts of Bihar have been notified as Backward Areas vide Notification No. S.O. 2241(E) dated   17.08.2015 to provide   certain tax benefits   like  15% additional   depreciation and investment allowances to give these areas an opportunity to grow faster. been

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