New Delhi [India], March 9 (ANI): The Department of Expenditure under the Ministry of Finance has released the 19th weekly instalment of Rs 2,104 crore to the states on Tuesday to meet the Goods and Services Tax (GST) compensation shortfall.
"Till now, 96 per cent of the total estimated GST compensation shortfall has been released to the states and Union Territories (UTs) with Legislative Assembly. Out of this, an amount of Rs 97,242.03 crore has been released to the states and an amount of Rs 8,861.97 crore has been released to the three UTs with the Legislative Assembly," read the press release by the Ministry of Finance.
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. 19 rounds of borrowings have been completed so far starting from October 23, 2020.
The amount released this week was the 19th instalment of such funds provided to the states. The amount has been borrowed this week at an interest rate of 5.8594 per cent. So far, an amount of Rs 1,06,104 crore has been borrowed by the central government through the special borrowing window at a weighted average interest rate of 4.8842 per cent.
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 per cent of Gross States Domestic Product (GSDP) to the states choosing Option-I to meet GST compensation shortfall to help them in mobilising additional financial resources.
All the states have given their preference for Option-I. Permission for borrowing the entire additional amount of Rs 1,06,830 crore (0.50 per cent of GSDP) has been granted to 28 states under this provision. (ANI)