The finance ministry has released the 14th weekly instalment of Rs 6,000 crore to states today to meet GST compensation shortfall. Of this, Rs 5,516.6 crore has been released to 23 states and Rs 483.40 crore to three UTs, including Delhi, Jammu & Kashmir and Puducherry. Notably, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation.
Till now, 76 per cent of the GST compensation shortfall has already been released to the states & UTs. Of this, Rs 76,616.16 crore has been released to states and Rs 7,383.84 crore to three UTs.
The Centre had set up a special borrowing window in October 2020 to meet the shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST. The Centre is borrowing funds via this window on behalf of the states and UTs. A total of 14 rounds of borrowings have been completed so far starting October 23, 2020.
A total of Rs 84,000 crore has been borrowed by the Centre so far at an average interest rate of 4.7395 per cent. In addition to providing funds through the special borrowing window to states and UTs, the government has granted additional borrowing permission equivalent to 0.50 per cent of Gross States Domestic Product (GSDP) to the states. All 28 states have been allowed to borrow an additional Rs 1,06,830 crore (0.50 percent of GSDP) via this mode
