UPA extends Rs 12,000 crore olive branch to Bihar | delhi | Hindustan Times
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UPA extends Rs 12,000 crore olive branch to Bihar

delhi Updated: Apr 17, 2013 22:27 IST
Chetan Chauhan
Chetan Chauhan
Hindustan Times
Nitish Kumar

The UPA government is set to offer an olive branch to Bihar chief minister Nitish Kumar who had recently taken potshots at Gujarat chief minister Narendra Modi, who is being projected as BJP’s prime ministerial candidate.

Kumar had been running a coalition government in Bihar with participation of BJP for the last eight years. On Sunday, Kumar took a dig at Modi inviting stark reaction from the BJP, thereby putting the coalition under stress.

Amid this political uncertainty, the UPA government has fast-tracked its proposal to allocate Rs 12,000 crore in the 12th five year plan (2012-17) to Bihar as a special plan under revamped Backward Regions Grant Fund (BRGF).

The Union Cabinet on Thursday is expected to take a call on the proposal doubling the allocation for Bihar under BRGF from about Rs 5,700 crore in the 11th five year plan.

Bihar is a beneficiary under new BRGF as the parameters to define backwardness of a state has been revised to “holistically” deal with socio-economic deprivations. As a result, entire Bihar is covered under the special plan.

Government sources said that once the cabinet decides the money will be released after examining the developmental proposals from the state. Of the total money, Bihar has already received Rs 1,500 crore in 2012-13 and is would get Rs 2,000 crore in the current financial year. “Remaining amount of Rs 8,500 crore will be released in the next three years,” an official said.

The money is still less than Rs 20,000 crore demanded by Kumar, who however, has already expressed his satisfaction over the proposal.

The Cabinet is also expected to agree with another demand of the Bihar CM to provide flexibility in spending of money provided by the Central government under Centrally Sponsored Scheme (CCS). The proposal before the Cabinet allows the state governments flexibility to use of up to 10% of the funds as per local needs. For that, the states would have to issue guidelines in consultation with the scheme implementing Central ministries.