New Delhi (NVI): The Ministry of Finance today released the 13th weekly instalment of Rs 6,000 crore to the 23 states to meet the GST compensation shortfall, taking the total amount of fund released to Rs 78,000 crore.
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 with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council, the Finance Ministry said in a statement.
The remaining five states namely Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation, it said.
About 70 percent of the total estimated GST compensation shortfall has been released to the States and UTs with Legislative Assembly till now.
Out of this, an amount of Rs 71,099.56 crore has been released to the States and an amount of Rs 6,900.44 crore has been released to the 3 UTs.
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 ministry said.
The borrowings are being done through this window by the Centre on behalf of the States and UTs. These borrowings have been completed in 13 rounds so far starting from October 23, 2020.
Moreover, the amount released this week was the 13th instalment of such funds provided to the States and the amount has been borrowed at an interest rate of 5.3083 per cent.
So far, an amount of Rs 78,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7491 per cent.
In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST, the government 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, the statement said.
All the states have given their preference for Option-I and 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, it added.