New Delhi: The Ministry of Finance today released the ninth 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 was released to 23 States and an amount of Rs.483.40 crore was released to the three Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir and 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.
Also read: Centre releases 8th Instalment of Rs. 6,000 crore to states
The Government of India 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 9 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 and December 28, 2020.
The amount has been borrowed this week at an interest rate of5.1508%. So far, an amount of Rs.54,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7488%.
In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Union Government 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 lakh crore (0.50 % of GSDP) has been granted to 28 States under this provision.
– global bihari bureau
