The Planning Commission and ministry of water resources last week decided to grant special category status to the impoverished region, comprising nine districts of Uttar Pradesh and 15 districts in Madhya Pradesh, for the irrigation projects.

The state governments can now seek 90 per cent grant assistance from the Centre to develop irrigation projects under the accelerated irrigation benefit scheme.

The remaining 10 per cent will be loan. Typically, such a funding from the Centre is in form of 70 per cent loan and 30 per cent grant. Only hill states have been given special category status so far.

In 2009, Congress general secretary Rahul Gandhi had asked Prime Minister Manmohan Singh to announce a special package for the region.

Special status is among various steps, including Rs 7,000-crore special grant and a mega power plant, taken by the Centre to develop agriculture infrastructure in the semi-arid plateau in a bid to improve the standard of living of 50 million people living there.

The ministry has prepared a note, circulated last week, for the Cabinet Committee on Infrastructure for special status for the area.

But, the decision to grant the status was taken at a meeting of the National Rainfed Area Authority on January 23. The chief secretaries of Uttar Pradesh and Madhya Pradesh had also participated in the meeting.