States aid report triggers debate on political realignment

A high-level committee today came out with a new methodology of additional assistance to ten 'least developed' states like Bihar and Odisha, a move that can trigger new alignments for the ruling Congress with parties like JD(U) during the next Lok Sabha elections.
Finance Minister P Chidambaram made public the recommendations of the report of the Committee for Evolving a Composite Development Index of States, chaired by former Chief Economic Advisor Raghuram Rajan, which were hailed by Bihar Chief Minister and JD(U) leader Nitish Kumar.
"Finally this report is primarily about the allocation of funds. The central government may want to offer additional forms of support to states that are particularly underdeveloped.

"The 10 'least developed' states that currently score above 0.6 (on Multi Dimensional Index of backwardness) could, for instance, be targeted for additional assistance," the five-member committee said in its recommendations.
The 'least developed' states are Odisha, Bihar, Madhya Pradesh, Chhattisgarh, Jharkhand, Arunachal Pradesh, Assam, Meghalaya, Uttar Pradesh and Rajasthan.
The recommendations along with allocations methodology effectively subsume what is now 'special category' among the states.
Chidambaram said the report will be examined and would be implemented from the the next financial year.
Kumar, who has been campaigning for special category status for Bihar and additional dose of funds for development, hailed the report as a "big victory" for principles and put Bihar on the path of development.