Special Category Status: A package outside Finance Commission Allocation, Eklavya Model Residential Schools, Makhana

(General Studies III – Economy Section – Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment. Inclusive Growth and issues arising from it.)

• In the run-up to the Union Budget, The Chief Ministers of Bihar and Andhra Pradesh, respectively have demanded special financial packages for their respective States.
• Special Category Status (SCS) is a classification given by the Centre to assist development of states that face geographical and socio-economic disadvantages.

Provisions for Special Category Status (SCS)?

• SCS for plan assistance was granted in the past by the National Development Council of the erstwhile Planning Commission.
• The Constitution does not make a provision for SCS and this classification was later done on the recommendations of the 5^th Finance Commission in 1969.

Gadgil formula for awarding Special Category Status (SCS) –

1. Hilly Terrain
2. Low Population Density and/or Sizeable Share of Tribal Population
3. Strategic Location along Borders with Neighbouring Countries
4. Economic and Infrastructure Backwardness
5. Non-viable Nature of State finances.

Benefits of Special Category Status –

• 90% of all state expenditures for all centrally sponsored programs and outside assistance are covered by the central government, and the remaining 10% is given to the state as a zero-interest loan.
• For states in the general category, the typical loan-to-grant ratio is 70% loan and 30% grant.
• These states have access to programs for debt reduction and debt exchange.
• To entice investment, states with Special Category Status are excluded from excise taxes, customs taxes, corporate taxes, income taxes, and other taxes.
• When it comes to receiving central funds, states are given preference, attracting development projects there.
• States have the option to carry over any unused funds from one fiscal year to the following without having them expire.

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. SCS might lead to disparities or dissatisfaction among non-SCS states.
• Dependency on Central Assistance: This could potentially discourage efforts toward self-sufficiency and independent economic growth strategies.
• Implementation Challenges: Due to administrative inefficiencies, corruption, or lack of proper planning. Ensuring that the allocated funds are used for intended purposes is a significant challenge.

Way Forward –

• There is a need to encourage states to create comprehensive development plans that focus on sustainable growth, job creation, infrastructure, etc.
• Encourage states to generate their revenue streams.
• Policies for gradually reducing states’ dependency on central assistance.

We need to channelise more resources for higher capital investment in the poorer   regions of the country for balanced regional development. The rationale for special status is that certain states, because of inherent features, have a low resource base and cannot mobilize resources for development. It is time to revisit the criteria and include other states into this exclusive category by excluding those who do not need such assistance any longer.

• The centralisation of recruitment for tribal residential schools, introducing Hindi competency as a mandatory requirement, has led to numerous transfer requests.
• Previously, state authorities managed staff recruitment for the Ministry of Tribal Affairs’ Eklavya schools.
• Many staff recruited from Hindi-speaking states are protesting against postings to Eklavya Model Residential Schools (EMRS) in southern states due to unfamiliar language, food, and culture.
• There is concern about the impact on tribal students being taught by teachers unfamiliar with their local language and culture.
• During the Budget Session of Parliament, the Finance Minister announced the responsibility shift to the National Education Society for Tribal Students (NESTS), tasked with staffing 38,000 positions in over 400 Eklavya schools nationwide.
• Officials stated that centralised recruitment aimed to address a severe teacher shortage in the EMRS system and standardise recruitment rules across states, which previously used varying criteria and state-specific reservation quotas.
• The National Testing Agency conducted the 2023 EMRS Staff Selection Examination for the first round of 4,000 vacant teaching and non-teaching positions.

Dig Deeper: What is the Minimum land requirement criteria? It has made sanctioning of EMRS in hilly regions difficult.

• Scientists from the Zoological Survey of India (ZSI) have discovered a new species of deep-water dogfish shark, Squalus hima, from Sakthikulangara fishing harbour in Kerala along the Arabian Sea.

• The discovery, made by the Marine Biology Regional Centre of ZSI, has been published in the journal Records of the ZSI.
• Genus: Squalus (commonly known as spurdogs)
• Family: Squalidae
• Squalus hima has been misidentified with S. mitsukurii and S. lalannei but is now recognized as a separate species.
• It belongs to the Squalus megalops group.
  

• These sharks are exploited for their liver oil, which contains high levels of squalene, in demand for pharmaceutical and high-end cosmetic products, and anti-cancerous products.
• Fishermen from the southern coast of India and Andaman and Nicobar Islands harvest these sharks for liver oil.
• The discovery of Squalus hima is crucial for the conservation of such species, which are commercially valuable for their fins, liver oil, and meat.
• They are also often caught as bycatch in fisheries targeting other species.
  

Dig Deeper: Technological innovations for the exploration and conservation of deep-sea biodiversity are one of the major components of the Deep Ocean Mission. List the other Five components.

• Makhana, also known as foxnut, is a key crop in Bihar, particularly in Darbhanga, with wetlands, rivers, and ponds.
• Bihar produces 10,000 tonnes of makhana annually, accounting for 90% of India’s and 80% of the world’s demand.
• The prickly water lily, the source of makhana seeds, spans over 15,000 hectares in Bihar, involving around five lakh families, primarily from the Mallah community, in its processing.
• Nine districts in the Mithila region are major producers.
• Harvesting involves collecting seeds from pond bottoms, grading, drying, roasting, and shell removal by women at home.
• The Bihar government provides a 75% subsidy on the Suvarna Vaidehi variety of seeds under the Makhana Development Scheme.
• Makhana is also part of the Union government’s One District One Product scheme, offering subsidies for branding, marketing, and infrastructure development.
• However, farmers seek more government support, including a minimum support price (MSP) to sustain cultivation.
• Women play a crucial role in the makhana economy, contributing to family earnings through seed processing.

Dig Deeper: Read about the One District One Product scheme.

• Varkala Cliff, located about 40 kilometres from Thiruvananthapuram in Kerala, is a scenic and geologically significant site. It offers breathtaking views of the Arabian Sea.
• The 6-km-long, 30-meter-high cliff formation dates back 23 million years, as per the Geological Survey of India.
• In 2014, the Geological Survey of India declared the red cliffs at Varkala the 27th National Geological Monument to pave the way for a national geo-park.
• Varkala is Kerala’s only beach with such a cliff, making it unique in a state known for its flat shoreline.
• Recently, concerns about the cliff’s stability have grown due to erosion. Various spots on the cliff have started caving in.
• Pruning of tree branches near the cliff edge has also been done to prevent further erosion.
• The cliff has a strong laterite layer on top but is underlain by softer sandstone and carbonaceous clay, leading to instability.
• Inadequate drainage systems and the weight of structures on top exacerbate the erosion.

Dig Deeper: List all the Geo-Heritage sites of India.