Tribune News Service
New Delhi, November 28
The Punjab Government has communicated acceptance of Option-1 to meet the revenue shortfall arising out of GST implementation. The acceptance after months of resistance to the Centre’s proposal will give the cash-strapped Punjab access to over Rs 11,000 crore of funds.
Punjab will get Rs 8,359 crore through the special borrowing window to meet the GST implementation shortfall with the Centre picking up the tab. By choosing Option-1, Punjab will be permitted to borrow Rs 3,033 crore but the onus of returning the money lies entirely with the state.
The die was cast for Chief Minister Amarinder Singh after the resistance by two other Opposition-ruled states crumbled earlier this week. Kerala and West Bengal communicated their acceptance of Option-1, leaving Punjab no option but to follow suit.
The number of states who have chosen the first option has now gone up to 26. All the three UTs with Legislative Assemblies (Delhi, J&K and Puducherry) have also decided in favour of Option-1, stated an official news release.
The states and UTs who chose Option-1 are getting the amount of shortfall arising out of GST implementation through a special borrowing window put in place by the Centre.
The window has been operational since October 23 and the Central Government has already borrowed Rs 24,000 crore on behalf of the states in four instalments and passed it on to the states and UTs, who chose Option-1.
Now Punjab will also receive funds raised through this window starting from the next round of borrowing.
Under the terms of Option-1, besides getting the facility of a special window for borrowings to meet the shortfall arising out of GST implementation, states are also entitled to get unconditional permission to borrow the final installment of 0.50 per cent of Gross State Domestic Product (GSDP) out of the additional borrowings permitted by the Government under Atmanirbhar Abhiyaan.
This is over and above the special window of Rs 1.1 lakh crore for all the states the UTs which basically compensates states for the Centre not having paid their GST dues on time.
“On receipt of the choice of Option-1 from Punjab, the Centre has granted additional borrowing permission of Rs 3,033 crore to the State Government of Punjab (0.5 per cent of the state’s GSDP).”