The long-standing deadlock between the Central and State governments over the GST compensation amount has ended. All 28 states and three union territories with legislative assembly have chosen the first option given by the central government to meet the revenue deficit due to GST. Jharkhand is the last state to choose this option.
Jharkhand, Chhattisgarh, Punjab, West Bengal and Kerala had earlier decided not to take the options given by the government. But now they have agreed on the first option. Significantly, the Central Government gave two options to the states with different conditions to compensate for GST compensation.
In which the first option was of Rs 97,000 crore and the second was of Rs 2.35 lakh crore. Later, under the first option, the borrowing limit was raised to Rs 1.1 lakh crore. The Center had agreed to borrow this amount and transfer it to the states. The second option was later removed.
The central government has opened a special lending window for the states and union territories that have opted for the first option. This window is being operated from 23 October and Rs. 30,000 crore has been borrowed by the states in five installments. This amount has been given to the first option states and union territories.
Now the Jharkhand government will also receive funds through this window from the next phase of lending. The next installment of six thousand crores will be released on December 7 to the states and union territories. The center will continue to pay the funds in installments to the states under a special window. All states have been allowed additional borrowing of Rs 1,06,830 crore.
