13 July 2024 : Indian Express Editorial Analysis

 1. Just a bargaining chip

(Source: Indian Express; Section: The Editorial Page; Page: 12)

Topic: GS2– Polity

Context:

The concept of Special Category Status (SCS) was introduced in 1969 by the Planning Commission during the Fourth Five-Year Plan. This status aimed to provide higher plan assistance to certain states facing socio-economic challenges and locational disadvantages. The primary goal was to promote balanced regional development across the country. Initially, Jammu and Kashmir, Assam, and Nagaland were the first states to receive this status, later expanding to include all northeastern states, Uttarakhand, and Himachal Pradesh.

What is a Special Category Status?

• SCS is a classification given by the Centre to assist development of states that face geographical and socio-economic disadvantages.
• The Constitution does not make a provision for SCS and this classification was later done on the recommendations of the 5th Finance Commission in 1969.
• Status was first accorded to Jammu and Kashmir, Assam and Nagaland in 1969.
• SCS for plan assistance was granted in the past by the National Development Council of the erstwhile Planning Commission.
• Eleven States including Assam, Nagaland, Himachal Pradesh, Manipur, Meghalaya, Sikkim, Tripura, Arunachal Pradesh, Mizoram, Uttarakhand and Telangana have been accorded the special category state status.Telangana, the newest State of India, was accorded the status as it was carved out of another state Andhra Pradesh.
• SCS is different from Special status which imparts enhanced legislative and political rights, while SCS deals with only economic and financial aspects.
  • For instance, J&K used to have Special status before Article 370 was repealed.

Parameters (Based on Gadgil Formula):

• Hilly Terrain;
  • Low Population Density and/or Sizeable Share of Tribal Population;
  • Strategic Location along Borders with Neighbouring Countries;
  • Economic and Infrastructure Backwardness; and
  • Nonviable Nature of State finances.

Benefits:

• In the past, SCS states used to receive approximately 30% of central assistance, determined by the Gadgil-Mukherjee formula.
  • However, following the recommendations of the 14th and 15th Finance Commissions (FC) and the dissolution of the Planning Commission, this assistance to SCS States has been subsumed in an increased devolution of the divisible pool funds for all States (increased to 41% in the 15th FC from 32%).
  • The Centre pays 90% of the funds required in a Centrally-Sponsored Scheme to special category status states as against 60% or 75% in case of other states, while the remaining funds are provided by the state governments.
  • Unspent money in a financial year does not lapse and is carried forward.
  • Significant concessions are provided to these states in excise and customs duties, income tax and corporate tax.
  • 30% of the Centre’s Gross Budget goes to Special Category states.

Evolution and Current Scenario

• Despite the dissolution of the Planning Commission and the establishment of NITI Aayog, the demand for SCS status has increased, driven by the influence of regional parties in the central government.
• This status has become a tool for political bargaining, requiring an amicable resolution.
• In February 2014, then Prime Minister Manmohan Singh announced special fiscal measures for Andhra Pradesh post-Telangana bifurcation, sparking debates on the constitutional and fiscal appropriateness of adding new states to the SCS list.

Recent Developments and Finance Commission Recommendations

• The 14th Finance Commission did not recommend special category states but recognized their needs through higher allocations for the northeastern states, Uttarakhand, and Himachal Pradesh.
• It proposed continued higher grants and lower cost-sharing for central projects.
• The 15th Finance Commission did not mention SCS but allocated a significant share of devolved taxes to the northeastern and hilly states, benefiting from considerations of ecology and area.

Conclusion and Future Outlook

• The dynamic political landscape and functioning of autonomous institutions in India make changes to the SCS list controversial.
• While leaders of aspirant states often claim SCS for political gains, studies suggest that proper utilization of existing funds and strategic central support could achieve similar benefits.
• The NDA government’s stance in 2018 emphasizes pursuing inclusive development through targeted interventions and transparent budgetary allocations, ensuring efficient resource utilization for the aspirant states.

What are the Concerns Related to Special Category Status?

Resource Allocation: Granting SCS entails providing additional financial assistance to the state, which can strain the central government’s resources. Balancing the allocation of funds among various states becomes crucial, and granting SCS might lead to disparities or dissatisfaction among non-SCS states. Dependency on Central Assistance: States with SCS often become heavily reliant on central assistance. This could potentially discourage efforts toward self-sufficiency and independent economic growth strategies. Implementation Challenges: Even after the grant of SCS, there might be challenges in utilizing the funds effectively due to administrative inefficiencies, corruption, or lack of proper planning. Ensuring that the allocated funds are used for intended purposes is a significant challenge.

Practice Question:  Discuss the concept of Special Category Status (SCS) in India, highlighting its historical origins, the criteria for allocation, and the financial benefits associated with it. Critically analyze the recent trends and political dynamics surrounding the demand for SCS, and evaluate the recommendations of the 14th and 15th Finance Commissions regarding the financial support to these states. (250 words/15 m)

 2. Inequity runs through it

(Source: Indian Express; Section: The Ideas Page; Page: 13)

Topic: GS2 – Social Justice

Context:

The article examines the socio-economic disadvantages faced by Muslims in India, as highlighted by recent data from the National Family Health Survey (2019-21). It discusses gaps in education, health, and socio-economic indicators, emphasizing how residential segregation exacerbates these issues. The article also addresses the underrepresentation of Muslims in public and political sectors and suggests policy measures to promote desegregation and inclusive development.

What is National Family Health Survey (NFHS)?

• The NFHS is a large-scale, multi-round survey conducted in a representative sample of households throughout India.

Conducted By:

• The Ministry of Health and Family Welfare (MoHFW) has designated the International Institute for Population Sciences (IIPS) Mumbai, as the nodal agency for providing coordination and technical guidance for the survey.
• IIPS collaborates with a number of Field Organizations (FO) for survey implementation.

Goals:

• Each successive round of the NFHS has had two specific goals:
  • To provide essential data on health and family welfare needed by the Ministry of Health and Family Welfare and other agencies for policy and programme purposes.
  • To provide information on important emerging health and family welfare issues.

Educational Disparities

• Muslims in India face significant educational disadvantages compared to the national average.
• The median years of completed schooling for a male household head from the Muslim community is nearly two years lower than the national average.
• This educational gap is critical as education is a precursor to accessing better job opportunities and socio-economic mobility.
• Contrary to popular belief, most Muslim children are enrolled in public schools rather than madarsas, indicating a preference for mainstream education.
• However, segregation and limited access to quality schools impede their educational progress.

Health Disparities

• The health disparities between Muslims and the average Indian population are stark.
• The urban infant mortality rate among Muslims is almost 5 percent higher than the national urban average.
• Additionally, a higher percentage of Muslim children under five are malnourished compared to their counterparts.
• These health indicators highlight the community’s struggle with accessing adequate healthcare and nutrition, further exacerbated by socio-economic disadvantages and residential segregation.

Residential Segregation and Its Impact

• Residential segregation is a significant factor contributing to the socio-economic challenges faced by Muslims in India.
• Segregation often leads to poor access to public goods and services, including education and healthcare.
• This segregation is partly self-imposed due to fear of violence but is mainly driven by discrimination in housing and land markets.
• The ghettoization of Muslims restricts their upward mobility and reinforces socio-economic disadvantages.

Implications of Segregation

• Segregation has severe implications for the socio-economic development of Muslims.
• It limits access to quality education, which is crucial for improving job prospects and overall well-being.
• The educational attainment of Muslims, particularly at the tertiary level, is lower than the national average, with a significant gender gap within the community.
• Higher fertility rates among Muslims are linked to lower educational levels, reinforcing a cycle of poverty and marginalization.

Underrepresentation in Public and Political Spheres

• Muslims are underrepresented in both public and political spheres in India.
• Despite constituting 14 percent of the population, Muslims account for only 3-6 percent of IAS and IPS officers and a similarly low percentage of district judges.
• Their political representation is also inadequate, with only 4-9 percent of MPs in the Lok Sabha being Muslim since Independence.
• This lack of representation further marginalizes the community and limits their influence in policy-making.

Policy Recommendations

• Addressing the socio-economic disparities faced by Muslims requires targeted policies.
• Effective policy experiments, such as Singapore’s Ethnic Integration Policy, could serve as models.
• Policies influencing bank loans and public land sales for housing can promote desegregation.
• Additionally, affirmative action policies in employment, education, and housing that account for economic disadvantage can help mitigate systemic biases.
• Encouraging mixed-community living can foster tolerance and cohesion, breaking down barriers and promoting inclusive development.

Practice Question:  Discuss the socio-economic challenges faced by Muslims in India, as highlighted by the National Family Health Survey (2019-21). Evaluate the impact of residential segregation on their access to public goods and services, and suggest policy measures to promote inclusive development and socio-economic upliftment of the community. (250 words/15 m)