The demand for funds and special attention of different states, finance minister P. Chidambaram said: “It would be more than adequately met by the twin recommendations of the basic allocation of 0.3 per cent of overall funds to each state and the categorisation of states that scores 0.6 and above as least developed states.” According to the Committee, these two recommendations, along with the allocation methodology, will effectively subsume what is now called “Special Category” status. Bihar along with some other states have been demanding “special category status” to get more funds and some tax concessions from the Centre. The report was likely to be implemented from the next financial year, Mr Chidambaram said, adding: “PM has directed that the recommendations of the committee may be examined and necessary action may be taken”. The committee was asked to suggest methods for identifying backwardness of states using a variety of criteria and to recommend how it may be reflected in future planning and devolution of funds from the Centre.
