Tribune News Service
New Delhi, December 14
States have received less than half of the shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST. In addition, the states have been allowed to borrow over Rs 1 lakh crore from the market to meet Covid-related shortfall.
The amount is being released in instalments and the one on Monday was the seventh. The usual practice is to release the money on a weekly basis. However, once there was a fortnight-long gap otherwise the flow of funds to states would have touched almost half of the amount, said sources.
The Centre has so far borrowed Rs 42,000 crore since October and released the funds to states and UTs to meet GST compensation shortfall, said the Finance Ministry after releasing the latest instalment of Rs 6,000 crore on Monday.
Out of the Rs 37,999 crore borrowed by the Centre on behalf of the states (the remaining is for UTs, primarily Delhi Rs 2,679 crore and J&K Rs 1,037 crore), Punjab has received Rs 1,385 crore. The Centre has permitted it to borrow another Rs 3,033 crore to meet Covid-related shortfall. The amount is equal to 0.5 per cent of its state gross domestic product.
The Centre has borrowed and passed on Rs 1,988.26 crore to Haryana, which has also borrowed Rs 4,293 from the market.
Himachal Pradesh has received Rs 784.43 crore of the Rs. 37,999 crore borrowed by the Centre and another Rs 877 crore from the market.
The amount borrowed in the seventh round has an interest rate of 5.1348 per cent though the average interest rate is 4.7712 per cent.
In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Centre has given additional borrowing permission equivalent to 0.50 per cent of Gross States Domestic Product (GSDP) to the states. States have so far raised Rs 1,06,830 crore equal to 0.50 per cent of their GSDP.