The Finance Ministry on Monday released the ninth instalment of Rs 6,000 crore to the states to meet GST compensation shortfall, taking the total quantity of fund released to Rs 54,000 crore.
The Centre had set up a specific borrowing window in October 2020 to meet the estimated shortfall of Rs 1.10 lakh crore in income arising on account of implementation of GST.
The Ministry of Finance in a statement stated it has released the ninth weekly instalment of Rs 6,000 crore to the states to meet the GST compensation shortfall.
Out of this, an quantity of Rs 5,516.60 crore has been released to 23 states and an quantity 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 amount has been borrowed this week at an interest rate of 5.15 per cent. 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 4.74 per cent,” the statement stated.
The remaining 5 states, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in income on account of GST implementation, an official statement stated.
The borrowings below the specific window have been performed in 9 rounds and the quantity borrowed so far was released to the states on October 23, November 2, November 9, November 23, December 1, December 7, December 14, December 21 and December 28, 2020.
In addition to offering funds by way of the specific borrowing window to meet the shortfall in income on account of GST implementation, the Centre has also granted extra borrowing permission equivalent to .50 per cent of Gross States Domestic Product (GSDP) to the states to enable them in mobilising extra monetary sources.
Permission for borrowing the whole extra quantity of Rs 1,06,830 lakh crore (.50 per cent of GSDP) has been granted to 28 states below this provision, the statement added.