eleventh instalment of Rs 6,000 crore for GST compensation shortfall launched

Image Source : REPRESENTATIONAL IMAGE/PTI eleventh instalment of Rs 6,000 crore for GST compensation shortfall launched
The Union Finance Ministry has launched the eleventh weekly instalment of Rs 6,000 crore to the states to satisfy the GST compensation shortfall. Out of this, an quantity of Rs 5,516.60 crore has been launched to 23 states and an quantity of Rs 483.40 crore has been launched to the three Union Territories (UTs) with Legislative Assembly (Delhi, Jammu & Kashmir, Puducherry) who’re members of the GST Council. The remaining 5 states — Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim — would not have a niche in income on account of GST implementation.
Now, 60 per cent of the estimated GST compensation shortfall has been launched to the states and UTs with a Legislative Assembly. Out of this, Rs 60,066.36 crore has been launched to the states and an quantity of Rs 5,933.64 crore has been launched to the three UTs with Legislative Assembly.
The Centre had arrange a particular borrowing window in October 2020 to satisfy the estimated shortfall of Rs 1.10 lakh crore in income arising on account of implementation of GST. The borrowings are being carried out via this window by the federal government on behalf of the states and UTs. The borrowings have been carried out in 11 rounds.

The quantity borrowed to date was launched to the states on October 23, November 2, 9, 23, December 1, 7, 14, 21, 28, January 4 and now.
The quantity launched this week was the eleventh instalment of such funds offered to the states. The quantity has been borrowed this week at an rate of interest of 5.1057 per cent.
So far, an quantity of Rs 66,000 crore has been borrowed by the Centre via the particular borrowing window at a mean rate of interest of 4.7271 per cent.
In addition to offering funds via the particular borrowing window to satisfy the shortfall in income on account of GST implementation, the federal government has additionally granted extra borrowing permission equal to 0.50 per cent of Gross States Domestic Product (GSDP) to the states selecting Option 1 to satisfy GST compensation shortfall to assist them in mobilising extra monetary sources. All the states have now given their choice for Option 1. Permission for borrowing all the extra quantity of Rs 1,06,830 crore (0.50 per cent of GSDP) has been granted to twenty-eight states below this provision.
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