Maharashtra bifurcation will fetch additional Rs30,000 crore annually

The bifurcation of Maharashtra to carve a separate statehood for Vidarbha may not connect with the Shiv Sena and MNS who are opposed to the division.

However, economically it promises to fetch an additional annual allocation of Rs30,000 crore from the centre.

The planning commission which allocates the funds on the basis of income distant methods (IMD), at present, clubs Maharashtra in the high income state category which cannot get more than 10 per cent of the funds from the centre’s pool.

The ruling Congress-NCP also complained against 6-7 per cent funds sanctioned from the centre despite being the highest revenue (40 per cent) generator of the country.

 The think tank within the Vidarbha Jan Andolan  supporting the division of state argue, “If Vidarbha is created it will come under middle income or low income group thus eligible for minimum annual allocation of Rs20,000 to 25,000 crore from the centre. The planning commission which also gives reward for state’s fiscal discipline will benefit rest of Maharashtra and help it fetch Rs10,000 crore once it gets rid of the backward Vidarbha region.”

According to BJP (MLA) and an economic expert Devendra Fadnavis, “If we set aside the political and emotional agenda and emphasise on development then division of state is absolutely justified.”

The parameters applied for fund disbursement (based on the Mukherjee-Gadgil formula) at the centre has defined that higher income states cannot exceed 10 per cent; middle income states 27 per cent and low income states 57 per cent of the funds sanctioned from the centre.

Fadnavis reveals, “In 1960, Vidarbha region had agreed to become a part of  Maharashtra with a condition that its development will be addressed. But the famous Nagpur pact was never implemented in letter and spirit as politics was always dominated by western Maharashtra politicians.” 

Fadnavis said, “What is shocking is that in 1952 Vidarbha with eight districts (currently it has 11 districts) which was not a part of Maharashtra had a surplus of Rs1.5 crore.” 

Notwithstanding the protest from its ally Sena, the BJP has decided to launch a door to door campaign explaining the development index to justify a separate Vidarbha state. The leaders are pleased with the massive turn out at the Vidarbha bandh last week held at Nagpur.

Majority of the 62 MLAs from the Vidarbha region support the separate state theory. While the Congress is divided, the NCP has supported the new state theory.

A  minister in Congress-NCP coalition said, “The chief minister Ashok Chavan’s Rs10,000 crore package for Vidarbha is an eyewash. If we have to address the overall irrigation problem it will require Rs40,000 crore. In the next 50 years we cannot address the problems of Vidarbha.”

Fadnavis argues, “Vidarbha generates 4,300 MW power. Its requirement is just 1,200 MW which means it can sell the remaining 3,300 MW and earn a revenue to the tune of Rs12,000 crore. Moreover, its sustained power supply can provide people a load shedding free regime.” 

The BJP cites Chhatisgarh as an example which after separating from Madhya Pradesh made huge progress in overall development.

Dismissing the feasibility criteria the BJP (MLA) said, “Today the state is reeling under Rs1.80 lakh crores. It cannot borrow more than Rs10,000 crore. Whereas, if Vidarbha is created it will not only get funds from centre but also enhance its borrowing capacity to Rs40-50,000 crores.”

The mineral rich cotton belt can become the steel hub in the future according to Fadnavis with proper planning.