Lok Sabha Question No. 1274 (UNSTARRED), answered on 2023-12-11
Subject: Special Status to Bihar
Ministry: FINANCE
Asked by: Rajiv Ranjan (Lalan) Singh, Kaushalendra Kumar, Dinesh Chandra Yadav

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF EXPENDITURE

## LOK SABHA UNSTARRED QUESTION No. †1274

TO BE ANSWERED ON MONDAY, December 11, 2023/Agrahayana 20, 1945 (Saka)

## SPECIAL STATUS TO BIHAR

## † 1274.  SHRI RAJIV RANJAN SINGH ALIAS LALAN SINGH SHRI KAUSHALENDRA KUMAR SHRI DINESH CHANDRA YADAV

Will the Minister of FINANCE be pleased to state:

- (a) whether the Government is contemplating on the long standing demand of granting 'the special category status to Bihar' to take the State out of backwardeness;
- (b) if so, the details of the tax schemes under which funds were provided to Bihar during the last five years under the special assistance, year-wise/scheme-wise and amount of fund-wise; and
- (c) if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

(a) to (c): Special Category Status for plan assistance was granted in the past by the National Development Council (NDC) to some States that are characterized by a number of features necessitating special consideration. These features included (i) hilly and difficult terrain, (ii) low population density and/or sizeable share of tribal population, (iii) strategic location along borders with neighboring countries, (iv) economic and infrastructural  backwardness  and (v) non-viable  nature  of  State  finances.  The  decision  was  taken  based  on  an  integrated consideration of all the factors listed above and the peculiar situation of the State. Earlier, the request of Bihar for Special  Category  Status was considered by an Inter-Ministerial Group (IMG) which submitted its Report on 30 th March, 2012. The IMG came to the finding that based on existing NDC criteria, the case for Special Category Status for Bihar is not made out.

Further,  as  per  the  Fourteenth  Finance  Commission  recommendations,  the  Union Government increased the share of net shareable taxes to the States from 32% earlier to 42% for the period 2015-20. The Fifteenth Finance Commission has also retained the same at 41% (1% adjusted on account of the reorganization of the State of Jammu and Kashmir) for the period 2020-26.  After acceptance of the Fourteenth Finance Commission recommendations, the State's share in divisible   pool of central   taxes   has increased, providing for more fiscal space to the States for contextual needs.

Details of Grants-in Aid and Loan released to the State Government of Bihar during financial years 2016-17 to 2022-23 are provided in the following Table:

(Rs. in crore)

| Sl. No.   | Items                                                            | 2016-17   | 2017-18   | 2018-19   | 2019-20   | 2020-21   | 2021-22   | 2022-23   |
|-----------|------------------------------------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|
| 1         | Share in Devolution of Central Taxes & Duties                    | 58,881    | 65,083    | 73,603    | 63,406    | 59,861    | 91,353    | 95,510    |
| 2         | Grants-in-aid                                                    | 20,559    | 25,720    | 24,652    | 26,969    | 31,764    | 28,606    | 58,001*   |
| 2         | Of which:                                                        |           |           |           |           |           |           |           |
| 2(a)      | Finance Commission Transfers                                     | 3,967     | 5,888     | 4,775     | 7,897     | 10,105    | 8,117     | 6,733     |
| 2(b)      | Special Assistance                                               | 1,329.40  | 3,414.00  | 739.47    | 0.00      | 195.7385  | 250.00    | 0.00      |
| 3         | Loan for Externally Aided Projects (EAPs)                        | 1,507.38  | 1,391.46  | 2,533.78  | 1,278.42  | 1,831.97  | 1,387.78  | 1,648.32  |
| 4         | Special Assistance to States for Capital Expenditure/ Investment | -         | -         | -         | -         | 843.00    | 1,246.00  | 8,455.85  |

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