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Special Assistance Measure (SAM) to Andhra Pradesh

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Special Assistance Measure (SAM) to Andhra Pradesh

Recently, it has been recommended to give Special Assistance Measure (SAM) to Andhra Pradesh on the lines of Special Category State (SCS) status.

  • On the basis of the liability arising out of the Andhra Pradesh Reorganization Act, 2014, the recommendations of the Finance Commissions and the report of the NITI Aayog, a provision for special assistance measures was made for the state of Andhra Pradesh.
  • Special assistance measures will be provided by way of repayment of loan and interest for Externally Aided Projects (EAP) signed and disbursed by the State during 2015-16 to 2019-20.
  • The special category state status was first proposed in the year 1969. It is a centrally-provided classification to assist in the development of states that face geographical and socio-economic disadvantages such as mountainous areas, strategic international borders, economic and infrastructural backwardness, and non-viable state finances.
  • The Fourteenth Finance Commission restricted the status of a special category state only to the north-eastern and three hill states.
  • Under the special category state category, the central government pays 90% of the state expenditure on all centrally sponsored schemes and external aid, while the remaining 10% is given as loans to the state at zero percent rate of interest.
  • The unspent money does not lapse and is carried forward. Special category states have been given exemption from customs duty, corporate tax, income tax and other taxes to attract investment.

Source – The Hindu

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