The State Government's efforts to prevail upon the BJP-led Central Government to accord special category status to Andhra Pradesh have hit a major roadblock with Union Minister of State for Statistics and Programme Implementation Rao Inderjit Singh stating in the Lok Sabha that “the question of granting special status to any state does not arise.”
Mr. Singh's statement is a major disappointment to the Chandrababu Naidu Government as it was heavily banking on the concessions/incentives that would accrue to the state if it were given special status.
Given its precarious financial position, Andhra Pradesh is expected to suffer a major hit if these privileges are not given to it.
States that are granted special category status would receive 90 per cent of the plan assistance as grant and 10 per cent as loan. This is in comparison with 30 per cent of plan assistance as grant and 70 per cent as loan for other states.
In addition, special category states would receive incentives in the form of tax rebates that would accelerate the setting up of industrial units.
According to industry sources, several companies have put on hold their proposed entry into Andhra Pradesh pending clarity on the special category status.
