Eyeing polls, UPA pares states share to raise extra fund for central schemes

Written by Mukesh Ranjan | New Delhi, Dec 18 | Updated: Dec 19 2007, 04:34am hrs
Risking a backlash from the NDA, especially BJP-ruled states, the UPA government has opted for massive hikes in central and centrally sponsored schemes in the social and rural infrastructure sectors.

The move, clearly aimed with an eye on the next general elections, has been effected by cutting shares of allocation of states in the 11th Plan. According to figures in the plan document that is to be put up for approval before the National Development council (NDC) meeting of chief ministers on Wednesday, the hike in such schemes is to the tune of 77.2% of the Gross Budgetary Support (GBS).

UPA managers are of the view that government's flagship programmes like Bharat Nirman, National Rural Employment Guarantee Act (NREGA) and Backward Region Grant Fund (BRGF), if executed and projected well, is certain to yield dividend in political terms. Similarly, the centrally sponsored schemes like Indira Awas Yojna and National Urban Renewal Mission (NURM) would also raise UPAs stocks and help in furthering their development agenda, they feel.

According to the Plan document, share projected in terms of central assistance to the states/UTs for the plan period (2007-12) has decreased from what has been realised in the 10th Plan primarily because a much higher allocation has been made to the central and centrally sponsored schemes. The allocation to the centrally sponsored schemes has almost been doubled from the last plan and it is pegged at 2.35% of GDP , it added.

NDA chief ministers, especially from BJP ruled states, are gearing up to take up the matter at the NDC meet. Party leaders have already charged that a lopsided distribution of resources is being effected which has favoured the Centre. After having experienced the Gujarat election campaign, in which Congress vigorously attempted to run down chief minister Narendra Modi on his development plank by claiming that most of the good things, which have happened in the state, are because of the Centre, the CMs of Orissa, Rajasthan, Madhya Pradesh and Chhattisgarh, the states heading for elections next year, are rearing to create ruckus in the meeting and might demand for amendment on the issue.

Until now, plan resource distribution has mostly remained even between Centre and states. Interestingly, the Gadgil formula of sharing resources with the states has also been given a go this time. Of the total 22.8% of states share, only 37% of it will go to the states as per the formula and the rest will go as additional central assistance for various flagship programmes in accordance with the priority set by the Centre.

Meanwhile, BJP chief Rajnath Singh, while raising the issue of communal budgeting by the Centre by reserving 15% of the Plan resources for the minority in the country during 11th Plan, has asked all his party CMs to oppose any such move by the government.

In a letter to the chief ministers, Singh said, The central government is trying to sow the seeds of discord, disharmony and disintegration by initiating such a move. I urge you all to firmly oppose any such move in the NDC meeting, which you will be attending.