Naidu’s downfall and AP’s fight for Special Category Status

Apart from Sikkim, Mizoram and Nagaland that account for one Lok Sabha seat each, Andhra Pradesh is the only major state where both the National Democratic Alliance (NDA) and United Progressive Alliance (UPA), have bitten the electoral dust. 

Andhra Pradesh, which sends 25 MPs to the Lok Sabha, also witnessed a simultaneous Assembly election in which both Congress and the Bharatiya Janata Party (BJP) were wiped out. 

Former chief minister, N Chandrababu Naidu, who was trying to garner the support of regional parties to stitch a third front, suffered a humiliating loss after his Telugu Desam Party (TDP) got just 23 out of 175 Assembly seats in AP. 

YSR Congress swept both Assembly as well as Lok Sabha polls with one-sided victories of on 22 Lok Sabha and 151 Assembly constituencies.  

In 2014, the erstwhile united Andhra Pradesh was bifurcated and Telangana was carved out of it. The Telangana region in the erstwhile Andhra had suffered years of neglect during Chandrababu Naidu’s regime, which only focused on developing Hyderabad. Following the bitter bifurcation, Andhra Pradesh lost its cash cow - Hyderabad.

While the state was being bifurcated, the then Prime Minister, Manmohan Singh, promised Special Category Status (SCS) to Andhra Pradesh, post the division. 

The promise was made on the floor of the Rajya Sabha, but there was no mention of it in the Andhra Pradesh Reorganisation Act, 2014. 

After the NDA government assumed power, the promise made by the previous UPA regime was not fulfilled on technical grounds. However, the NDA announced a special package for the state, which was accepted by TDP-led state government. 

But soon, the political discourse in the state changed with Jagan’s YSRC picking up the issue of Centre’s apparent betrayal over its SCS promise.  

Former Union finance minister Arun Jaitley even went to the extent of assuring that special package was better than SCS and there was basically no difference between the two. 

However, regional sentiments were worked up against the Centre. Jagan, who walked over 3,600 km across AP during his ‘praja sankalpa yatra’, raised the SCS issue at his public meets. 

Meanwhile TDP, then a part of the NDA, snapped its ties with the BJP. Naidu and his MPs even staged protests across AP and even in the national capital.  

The criteria for granting SCS to a state includes parameters like hilly and difficult terrain, strategic locations along the country’s borders, low population density and economic and infrastructure inadequacies, among others. It was first introduced in 1969 to provide certain disadvantaged states with benefits in the form of central assistance and tax breaks. So far, 11 states have been granted the SCS.

In 2013, a panel headed by the then chief economic advisor Raghuram Rajan, recommended a new index of backwardness to determine which states need special assistance. 

On the allocation of central funds, the report suggested that each state should get a basic fixed allocation of 0.3 per cent of the overall funds and an additional allocation depending on its development needs and performance, thus subsuming the concept of SCS. 

Naidu repeated the same mistake in 2014, which caused his debacle in 2004. In 2014, Naidu, after becoming the first chief minister of newly bifurcated Andhra, dedicated his entire focus in building Amaravati as a commercial hub and the new capital city, without settling other issues with Telangana and developing the rest of Andhra. He was also too late to react over the SCS issue. 

As sentiments in AP were already inflamed against both UPA and NDA regimes over alleged betrayal on SCS promise, Jagan was seen as the most suitable option. 

The way ahead for Jagan, however, is not easy, as he has no leverage to pressure the BJP-led government at the Centre over his demand. The Centre fears that if AP is offered SCS as a special case, other states would follow suit. 

Jagan had raised the issue at his very first meeting with Prime Minister Narendra Modi. The newly appointed CM has asked officials to prepare a report to be placed before the 15th Finance Commission, stressing the need for SCS. He has made it clear that he will not just let go off the SCS, but there’s only little that he can do. 

The author is a journalist with DNA