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FinMin releases weekly installment of ₹6,000 cr to States to meet GST shortfall

Till now, 76% of the overall estimated GST compensation shortfall has been launched to States and three Union Terrirtories.

The Finance Ministry on Wednesday launched the 14th installment of ₹6,000 crore to States to meet the GST compensation shortfall, taking the overall quantity of fund launched to date to ₹84,000 crore.

Till now, 76% of the overall estimated GST compensation shortfall has been launched to States and three Union Terrirtories.

Out of this, an quantity of ₹76,616.16 crore has been launched to 23 States and ₹7,383.84 crore to the three Union Terrirtories with Legislative Assembly (Delhi, J&Okay, Puducherry).

The remaining 5 States — Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim — should not have a spot in income on account of GST implementation, it added.

The Centre had arrange a particular borrowing window in October 2020 to meet the estimated shortfall of ₹1.10 lakh crore in income arising on account of implementation of GST.

The Finance Ministry in a press release mentioned it has launched the 14th weekly installment of ₹6,000 crore to States to meet the GST compensation shortfall. The quantity has been borrowed this week at an rate of interest of 4.61%.

“So far, an amount of ₹84,000 crore has been borrowed by the central government through the special borrowing window at an average interest rate of 4.74%,” it added.

In addition to offering funds by the particular borrowing window to meet the shortfall in income on account of GST implementation, the Centre has additionally granted further borrowing permission equal to 0.5% of Gross State Domestic Product (GSDP) to States to assist them mobilise further monetary assets.

Permission for borrowing your entire further quantity of ₹1,06,830 crore (0.5% of GSDP) has been granted to 28 States underneath this provision, the assertion added.

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