Consider the following statements regarding the Gadgil Formula and the Special Category Status for states in India —
- The Gadgil Formula was developed in 1969 to determine the allocation of central assistance for state plans in India.
- The Special Category Status is granted to states based on criteria such as hilly terrain, low population density, and strategic international borders.
- Under the Gadgil Formula, states with Special Category Status receive 90% of plan assistance as grants and the remaining 10% as loans.
- The Gadgil Formula exclusively applies to the distribution of revenue among states from central taxes.
Which of the statements given above are correct?
Explanation - The Gadgil Formula, named after D.R. Gadgil, was indeed developed in 1969 to determine the allocation of central assistance for state plans, aiming at balanced regional development (Statement 1 is correct). Special Category Status (SCS) is granted to states based on specific criteria including hilly terrain, low population density, and strategic location along international borders, among others (Statement 2 is correct). States with Special Category Status receive a significant proportion (90%) of plan assistance as grants, which is non-repayable, and the remaining 10% as loans (Statement 3 is correct). The Gadgil Formula is used for the allocation of plan assistance, not revenue from central taxes (which is the domain of the Finance Commission), making Statement 4 incorrect.
Explanation - The Gadgil Formula, named after D.R. Gadgil, was indeed developed in 1969 to determine the allocation of central assistance for state plans, aiming at balanced regional development (Statement 1 is correct). Special Category Status (SCS) is granted to states based on specific criteria including hilly terrain, low population density, and strategic location along international borders, among others (Statement 2 is correct). States with Special Category Status receive a significant proportion (90%) of plan assistance as grants, which is non-repayable, and the remaining 10% as loans (Statement 3 is correct). The Gadgil Formula is used for the allocation of plan assistance, not revenue from central taxes (which is the domain of the Finance Commission), making Statement 4 incorrect.