FINANCE COMMISSION

Q. 2016 JULY II
Which among the following is not a criterion for declaring special category state?
(1) Over population
(2) Poor infrastructure
(3) Hilly and difficult terrain
(4) Non-viable state finances
ANS: (A)
• The concept of special category state was introduced in 1969 during the period of fifth finance commission.
• It was initiated to help the most disadvantaged states in India to keep up with other states.
• In the beginning, there were only three states in the category. Assam, Nagaland and Jammu & Kashmir.
• Later on, 8 more states were added namely, Arunachal Pradesh, Madhya Pradesh, Meghalaya, Mizoram, Sikkim, Tripura & Uttarakhand.
Features required:
(i) hilly and difficult terrain;
(ii) low population density or sizeable share of tribal population;
(iii) strategic location along borders with neighbouring countries;
(iv) economic and infrastructural backwardness; and
(v) non-viable nature of state finances.