No special category status, but Centre to give special assistance to AP

Hyderabad: After a day-long drama at Vijayawada and Delhi, Union finance minister Arun Jaitely late on Wednesday said that the Centre had decided to give AP a ‘Special Assistance Measure’ that would be equal to the benefits the state would have got under special status.

The Centre announced a financial package that included full funding of the Polavaram irrigation project, tax concessions and special assistance. The state will also get a railway zone, and its headquarters would be decided by the railway minister. Speaking to the media past 10.30 pm in Delhi, Mr Jaitley said the details of the package would be announced on Thursday.

AP CM refused to go to Delhi sans special category status
Arun Jaitely said every assurance given in the AP Reorganisation Act would be implemented by the Centre. Mr Jaitley said that the Centre would bear the total expenditure for the construction of the Polavaram irrigation project from April 1, 2014, when it was declared a national project. The state government would implement the project,

Citing constraints placed by the 14th Finance Commission in granting special category status, he said equal benefits would be given to the state in the form of a Special Assistance Measure for five years. This would be in the form of externally-aided projects. The state would get two tax concessions, details of which would be notified by the Central Board of Direct Taxes.

Earlier in the day, there was hectic activity at the Chief Minister’s Office in Vijayawada and Mr Jaitley’s office at Delhi. AP Chief Minister N. Chandrababu Naidu and Mr Jaitley held a series of meetings over the package. Mr Naidu met with ministers available in Vijayawada over the Central package. In Delhi, Union minister Y.S. Chowdary and TD MPs held day-long discussions with Mr Jaitley and Union minister M. Venkaiah Naidu.

While the discussions were going on, Mr Venkaiah Naidu called the AP Chief Minister over phone and asked him to come to Delhi to discuss the package. The Chief Minister replied that unless the Centre agreed to the nine main demands of the state government, he would not go to the capital. He said there would be no compromise on the demand of special category status.