The Telegraph
Since 1st March, 1999
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Fund to pull districts out of dumps

New Delhi, Sept. 20: The government is likely to launch a dedicated fund to correct regional imbalances by providing money to catalyse development in 250 backward districts of the country.

Although a date for launching the fund — called the Backward Regions Grant Fund — is yet to be finalised, official sources said October 22 is being considered as it will mark the halfway point of the UPA regime.

Under the fund, money would be provided on a 100 per cent grant basis and allocated as additional central assistance to state plans.

For the current fiscal, Rs 3,750 crore would be allocated for the development of 250 backward districts that include 11 from Bengal, 21 from Jharkhand, 36 from Bihar, 11 from Assam, 34 from Uttar Pradesh and 19 from Orissa.

Of this amount, Rs 250 crore per annum will be provided at Rs 1 crore per district for capacity building and the balance as an untied development fund.

Similar annual allocations would continue for the entire 11th Five Year Plan (2007-2012).

Officials in the ministry of panchayati raj, which is the nodal ministry for the backward regions’ fund, said draft guidelines have been circulated to various states and Union territories for their comments. Most of the states have sent their comments and the remaining ones are likely to complete the exercise by this month.

After obtaining the comments, final guidelines will be prepared by the end of this month or early October.

The backward regions to be covered under the fund will include all the 200 districts where the National Rural Employment Guarantee Scheme is being implemented as well as the 50 mentioned in an inter-ministerial task group report on backwardness, which was constituted by the Planning Commission.

The central assistance will be used to provide infrastructure and promote good governance and agrarian reforms in the backward districts.

Panchayati raj institutions from the village to the district level will be the authorities for planning and implementation of projects to be funded by the backward regions’ fund.

Panchayats and municipalities will prepare the plans through people’s participation. These plans will then be consolidated by district planning committees.

In 147 of the 250 districts, where the Rashtriya Sam Vikas Yojana is being implemented, the funds will be given to complete ongoing programmes under the scheme, following which projects using the remaining allocation from the fund would be launched. In the remaining 103 districts, the programmes using the fund allocation will start straightaway.

The quantum of money from the backward regions’ fund given to each panchayat will be calculated on the basis of a transparent formula to be decided at the local level.

Within the district, the formula can be aimed at specific pockets of backwardness.

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