On 22 November, the Bihar Cabinet passed a resolution seeking grant of Special Category Status (SCS) to Bihar.
- Odisha and Andhra Pradesh governments have also echoed the demand for this status.
- As per the Central Government, The 14th Finance commission has clearly said no special status can be given to states.
What is a special category status (SCS)?
- The SCS was introduced in 1969 on the recommendations of the 5th Finance Commission to benefit certain backward states having hilly terrains, strategic international borders, and economic and infrastructural backwardness.
SCS criteria
To be able to get the special category status, states have to fulfill the following requirements: –
- Need to have hilly and difficult terrain
- Need to have low population density and /or a sizeable share of the tribal population
- Must be in a strategic location along borders with neighbouring countries;
- Must be economically and infrastructurally backward;
- Must have non-viable nature of state finances.
Current SCS states
- Currently, 11 states have the Special Category Status in the country including Assam, Nagaland, Himachal Pradesh, Manipur, Meghalaya, Sikkim, Tripura, Arunachal Pradesh, Mizoram, Uttarakhand, and Telangana.
Benefits of SCS
- Special Category Status states get 90 per cent of the funds from centre in Centrally Sponsored Schemes (CSS). Regular states get 60 per cent to 75 per cent of the fund from the Centre under the same schemes and they have to manage the rest.
- In case of unspent money, the states with SCS have the provision to carry it forward.
- The SCS states enjoy a significant concession on excise, customs duties, income tax, and corporate tax.
