100 percent of the estimated GST compensation shortfall of Rs.1.10 Lakh crore released

Ministry of Finance

The Ministry of Finance, Department of Expenditure has released the final weekly instalment of Rs.4,104 crore to the States to meet the GST compensation shortfall. Out of this, an amount of Rs.4,086.97 crore has been released to 23 States and an amount of Rs.17.03 crore has been released to the 3 UTs with Legislative Assembly.

With the current release, 100 percent of the total estimated GST compensation shortfall of Rs.1.10 lakh crore for the year 2020-21 has now been released to the States & UTs with Legislative Assembly. Out of this, an amount of Rs.101,329 crore has been released to the States and an amount of Rs.8,879 crore has been released to the 3 UTs with Legislative Assembly.

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 borrowings are being done through this window by the Government of India on behalf of the States and UTs. Starting from 23rd October, 2020, the borrowings were completed in 20 weekly instalments.

Under the special window, the Government of India has been borrowing in Government Stock with tenure of 3 years and 5 years. The borrowings made under each tenure are equally divided among all the States as per their GST compensation shortfall. With the current release, the proportionate pending GST shortfall with respect to borrowing under both 5 years tenure and 3 year tenure has been concluded for 23 States and 3 UTs with legislature. Remaining 5 States doesn’t have any GST compensation shortfall.

The amount released this week was the 20th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 4.9288%. The total amount of Rs.1,10,208 crore has been borrowed by the Central Government through the special borrowing window at an weighted average interest rate of 4.8473%.

In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Government of India has also granted additional borrowing permission equivalent to 0.50 % 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. All the States have given their preference for Option-I. Permission for borrowing the entire additional amount of Rs.1,06,830 crore (0.50 % of GSDP) has been granted to 28 States under this provision.

The amount of additional borrowing permission granted to 28 States and the amount of funds raised through special window and released to the States and Union Territories so far is annexed.

State wise additional borrowing of 0.50 percent of GSDP allowed and amount of funds raised through special window passed on to the States/UTs till 15.03.2021

(Rs. in Crore)

S. No. Name of State / UT Additional borrowing of 0.50 percent allowed to States Amount of fund raised through special window passed on to the States/ UTs
1 Andhra Pradesh 5051 2311.00
2 Arunachal Pradesh* 143 0.00
3 Assam 1869 994.00
4 Bihar 3231 3905.00
5 Chhattisgarh 1792 3109.00
6 Goa 446 840.00
7 Gujarat 8704 9222.00
8 Haryana 4293 4352.00
9 Himachal Pradesh 877 1717.00
10 Jharkhand 1765 1689.00
11 Karnataka 9018 12407.00
12 Kerala 4,522 5766.00
13 Madhya Pradesh 4746 4542.00
14 Maharashtra 15394 11977.00
15 Manipur* 151 0.00
16 Meghalaya 194 112.00
17 Mizoram* 132 0.00
18 Nagaland* 157 0.00
19 Odisha 2858 3822.00
20 Punjab 3033 8359.00
21 Rajasthan 5462 4604.00
22 Sikkim* 156 0.00
23 Tamil Nadu 9627 6241.00
24 Telangana 5017 2380.00
25 Tripura 297 226.00
26 Uttar Pradesh 9703 6007.00
27 Uttarakhand 1405 2316.00
28 West Bengal 6787 4431.00
  Total (A): 106830 101329.00
1 Delhi Not applicable 5865.00
2 Jammu & Kashmir Not applicable 2272.00
3 Puducherry Not applicable 742.00
  Total (B): Not applicable 8879.00
  Grand Total (A+B) 106830 110208.00

 

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