A total amount of Rs.60,000 crore released so far to all states and UTs with legislation
This is in addition to additional borrowing permission of Rs.1,06,830 crore granted to the States
New Delhi: The Ministry of Finance today released the 10th weekly instalment of Rs.6,000 crore to the states to meet the GST compensation shortfall. Out of this, an amount of Rs.5,516.60 crore has been released to 23 States and an amount of Rs.483.40 crore has been released to the three union territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council. The remaining 5 States, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation. Now, more than 50 percent of the estimated GST compensation shortfall has been released to the States & UT with Legislative Assembly.
Also read: States get ninth instalment of Rs.6,000 crore as loan to meet the GST compensation shortfall
The Government had set up a special borrowing window in October, 2020 to meet the estimated shortfall of Rs.1.10 lakh crore in revenue arising on account of implementation of GST. The borrowings are being done through this window by the Government of India on behalf of the States and UTs. The borrowings have been done in 10 rounds. The amount borrowed so far was released to the States on October 23, 2020, November 2, 2020, November 9, 2020, November 23, 2020, December 1, 2020, December 7, 2020, December 14, 2020, December 21, 2020, December 28, 2020 and January 4, 2021.
The amount has been borrowed this week at an interest rate of4.1526%.So far, an amount of Rs.60,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.6892%.
In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Centre has also granted additional borrowing permission equivalent to 0.50 % of Gross States Domestic Product(GSDP)to the states choosing Option-Ito meet GST compensation shortfall to help them in mobilising additional financial resources. All the States have been given their preference for Option-I. Permission for borrowing the entire additional amount of Rs.1,06,830 crore(0.50 % of GSDP) has been granted to 28 States under this provision.
The amount of additional borrowing permission granted to 28 States and the amount of funds raised through special window and released to the States and Union Territories so far is annexed.
– global bihari bureau
