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10th Instalment of Rs.6,000 crore released to the States as back to back loan to meet the GST compensation shortfall

Posted on 05 January 2021

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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

The Ministry of Finance has released the 10thweekly 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 3 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.

The Government of Indiahad 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 borrwoings 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 23rd October, 2020, 2nd November, 2020, 9th November, 2020, 23rd November, 2020, 1st December, 2020, 7th December, 2020, 14th December, 2020, 21st December, 2020, 28thDecember, 2020 and 04th January, 2021.

The amount released this week was the 10th instalment of such funds provided to the States. 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 Government of India 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.

Statewise additional borrowing of 0.50 percent of GSDP allowed and amount of funds raised through special window passed on to the States/UTs till 04.01.2021

(Rs. in Crore)

S. No.

Name of State / UT

Additional borrowing of 0.50 percent allowed to States

Amount of fund raised through special window passed on to the States/ UTs

1

Andhra Pradesh

5051

1433.25

2

Arunachal Pradesh*

143

0.00

3

Assam

1869

616.72

4

Bihar

3231

2421.54

5

Chhattisgarh

1792

846.30

6

Goa

446

520.85

7

Gujarat

8704

5719.15

8

Haryana

4293

2699.05

9

Himachal Pradesh

877

1064.87

10

Jharkhand

1765

459.75

11

Karnataka

9018

7694.69

12

Kerala

4,522

1897.80

13

Madhya Pradesh

4746

2816.91

14

Maharashtra

15394

7428.29

15

Manipur*

151

0.00

16

Meghalaya

194

69.39

17

Mizoram*

132

0.00

18

Nagaland*

157

0.00

19

Odisha

2858

2370.37

20

Punjab

3033

2751.20

21

Rajasthan

5462

2160.37

22

Sikkim*

156

0.00

23

Tamil Nadu

9627

3870.80

24

Telangana

5017

947.73

25

Tripura

297

140.40

26

Uttar Pradesh

9703

3725.41

27

Uttarakhand

1405

1436.55

28

West Bengal

6787

1458.37

Total (A):

106830

54549.76

1

Delhi

Not applicable

3637.32

2

Jammu & Kashmir

Not applicable

1408.98

3

Puducherry

Not applicable

403.94

Total (B):

Not applicable

5450.24

Grand Total (A+B)

106830

60000.00

* These States have 'NIL' GST compensation gap

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