Special assistance announced for Bihar, Bengal

New Delhi: In a move apparently dictated more by politics, Finance Minister Arun Jaitley Saturday proposed a series of sops for Bihar and West Bengal, which are set to hold assembly polls this year and in 2016.Presenting the union budget for 2015-16, Jaitley announced special assistance for the two eastern states on the lines of a package provided to Andhra Pradesh.

Jaitley said the 14th Finance Commission has not distinguished between special category and other states in making their recommendations."Moreover, both Bihar and West Bengal are going to be amongst the biggest beneficiaries of the recommendations of the Finance Commission. Yet, the eastern states have to be given an opportunity to grow even faster.

"I, therefore, propose to give similar special assistance to Bihar and West Bengal as has been provided by the government of India in the case of government of Andhra Pradesh," Jaitley said.There was more good news for Bihar."Keeping in view the need to augment medical science in Bihar, I propose to set up another AIIMS-like institution."He also promised to upgrade the Indian School of Mines, Dhanbad, into a full-fledged IIT.

Jaitley's party BJP has set its eyes on Bengal, as it aims to extend its sphere of influence.After having vastly increased its vote share in recent elections, the BJP wants to emerge as the main alternative to the ruling Trinamool Congress in the assembly elections next year.

The BJP was the junior coalition partner to Nitish Kumar's Janata Dal-United in the Bihar government for seven and a half years till mid-2013.The JD-U severed ties with the BJP over the latter's decision to project Narendra Modi as its prime ministerial candidate. Nitish Kumar recently returned as Bihar chief minister.

The BJP is aiming big in Bihar and hopes to win the assembly polls slated for November.However, Jaitley denied that any politics was involved in the decision to shower largesse on the two states."Funds for West Bengal and Bihar are not for political gain but in keeping with the prime minister's promise of developing the eastern states," he said.

Jaitley's announcements led to mixed reactions.Nitish Kumar said he had requested the finance minister to not end the Backward Regions Grant Fund (BRGF) and he thanked Jaitley for his announcement."Provisions of Bihar reorganisation will not be affected," he said.

The Trinamool Congress, however, dubbed as "a bluff" the special financial assistance to Bengal announced in the budget."There is a talk of a package in the lines of Andhra Pradesh, but we do not know the amount of package or any details. The package to Andhra was Rs.850 crore. But the centre deducted Rs.28,000 crore from us towards servicing of debts. So this is a bluff," said state Finance Minister Amit Mitra.

West Bengal Chief Minister Mamata Banerjee has time and again sought a moratorium on repaying central loans that her debt-stressed state has accrued over the years.But business lobby Confederation of Indian Industry hailed the announcements, saying the proposals on West Bengal and Bihar have raised expectations among the people.

"This goes to show that the central government is sincere in its efforts to boost the economies of the eastern states. The CII is confident that the promised assistance will be substantial and significant. We are particularly happy that the development of the eastern and the northeastern states received special mention in the union finance minister's budget speech," said CII's former president J.P. Chowdhary.