Hyderabad: It was a day of hectic activity and series of meetings in New Delhi and Vijayawada as India’s central government was inching closer to announcing a special economic package for truncated Andhra Pradesh, in lieu of the Special Category Status the state was demanding.

However the expected announcement was unlikely to come on Wednesday as the Centre had asked the Chief Minister N. Chandrababu Naidu to come to New Delhi to formally accept the package.

Union Minister for urban development M. Venkaiah Naidu, who also hails from Andhra Pradesh, telephoned Chandrababu in the morning and requested him to come to New Delhi.

Sources said Venkaiah Naidu told Chandrababu his presence in New Delhi was required so that all the points in the package could be clarified before an official announcement. Amid the continuing meeting and consultations, Union Finance Minister Arun Jaitely was reportedly keen that the package should be announced only in the presence of Chandrababu Naidu.

Against this backdrop, Union Minister of State Y.S. Chowdary and Telugu Desam MP C.M. Ramesh, both close confidantes of Chandrababu, also met Union Home Minister Rajnath Singh, Jaitely and Venkaiah Naidu in New Delhi to seek clarifications on the provisions of the package.

Sources said senior officials from the Prime Minister’s Office were also involved in discussions to finalise the special package.

They were likely to meet Naidu and explain the details of the package, if the Chief Minister accepts the invitation to come to Delhi.

The Centre was apprehensive that it would be highly embarrassing, if Chandrababu Naidu rejected the package after it was finalised and announced by Jaitely.

The central government has offered a special economic package instead of the Special Category Status (SCS) and a draft has been prepared after a weeklong exercise.

But Chandrababu was facing a big dilemma whether to accept the package in place of the Special Category status as it could trigger a political backlash.

He met his cabinet colleagues in the morning in Vijayawada to decide on a course of action.

All the opposition parties including the YSR Congress and the Indian National Congress have warned the state government against going back on the demand for SCS.

According to the sources, many of Chandrababu Naidu’s ministers and advisers were averse to the idea of his going to New Delhi at this stage as there was no clarity about many of the points in the proposed package.

Naidu was mulling the idea of sending a group of senior ministers for discussions to finalise the package before he visits the national capital for finalisation.

The chief minister sought the views of the senior ministers on how to respond if the package offered by the Centre did not meet all the expectations and demands of the state.

Naidu told the ministers he had no official information about the package and had not considered any alternative to the special category status.

There were serious differences in the positions of the Centre and Andhra Pradesh government over most of the points of the proposed package.

Chandrababu has taken the stand that he will not accept if it is less than the benefits of the promised Special Category Status.

The AP government and political parties were insisting on Special Category Status as it means 90 per cent of the financial assistance from the Centre will be treated as a grant. Under the package, only 60 per cent of the assistance would qualify as a grant. There was ambiguity on issues like incentives for industry, setting up the railway zone in Visakhapatnam and bridging the revenue gap the state was facing since the bifurcation in 2014.

The Centre was unwilling to set up a Railway Zone at Visakhapatnam and was in favour of Vijayawada. However the state was worried that it will create big trouble in north coastal Andhra districts.

On the issue of bridging the revenue deficit, the Centre was willing to release only Rs30 billion (Dh1.6 billion) while the state insists that the gap was more than Rs200 billion.

The state government was expecting that this would come into retrospective effect from the date of bifurcation while the Centre’s thinking on the issue was not yet clear.

On the Polavaram irrigation project, which has been given national status, the Centre has agreed to release 90 per cent of the cost as a grant.

The other major issues in the draft package include massive assistance for the construction of the new capital Amaravati and Rs50 billion per annum subsidy for setting up new industries in the state.