Rethinking of Special Category Status to Poorer States in India

Abstract

There are twenty nine states and seven union territories in India. Some States have been provided some benefits by the union government as they fall under the Special Category States. In 1969, the Fifth Finance Commision acting in line to the Gadgil formula, had accorded Special Status to three states namely Assam, Nagaland and Jammu & Kashmir on the basis of hilly terrains, having international boundaries, backwardness and social probles prevailing in these states. As per formula such states get preferential treatment in federal assistance and tax breaks. These states also get excise duty concessions and thus, help to attract large number of industrial units to establish manufacturing factories within their territories. Now many other states have been categorised nder this term like Himachal Pradesh (1970-71) , Manipur, Meghalaya and Tripura (1971-72) Sikkim (1975-76), Arunachal Pradesh and Mizoram (1986-87) and Uttarakhand (2000-01)