Ahead of the general and assembly elections, the UPA government has bowled a googly by declaring Narendra Modi government in Gujarat as one of the less developed states in the country. Narendra Modi has been leading BJP’s election campaign ahead of Lok Sabha polls, glorifying the Gujarat’s development model.
A panel led by Raghuram Rajan, former chief economic adviser in the finance ministry and the incumbent governor of Reserve Bank of India, has said that Goa, Kerala and Tamil Nadu are the most developed states, while Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Meghalaya, Odisha, Rajasthan and Uttar Pradesh are the least developed states.
The index ranges from zero to one, with one being the most backward and zero the least backward or the ‘relatively developed’, according to the committee.
The report has recommended ending the ‘special category’ criteria for providing additional assistance to poorer states and suggested a new methodology for devolving funds on states based on a ‘Multi Dimensional Index (MDI). Currently, the central government provides additional funds to special category states. The panel has recommended splitting up of 28 states into three categories- least developed, less developed and relatively developed based on their MDI score.
The committee has used per capita consumption and poverty ratio to create three categories for states in the country. The committee has asked that each state be allocated 0.3% of the overall funds. An amount will be added to this share depending on the need and performance of each state to arrive at the state’s overall share.
The committee was set up after Bihar chief minister, Nitish Kumar had asked for a special category status for his state.
Finance minister P Chidambaram had promised in his budget speech in February that the criteria would be revised to include states such as Bihar.
Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Meghalaya, Odisha, Rajasthan and Uttar Pradesh.
Goa, Kerala and Tamil Nadu.