13th Instalment of ₹ 6,000 crore released to the States to meet the GST compensation shortfall

A total amount of ₹ 78,000 crore released so far to all States and UTs with legislature

This is in addition to additional borrowing permission of ₹ 1,06,830 crore granted to the States

The Ministry of Finance, Department of Expenditure has released the 13^th weekly instalment of ₹ 6,000 crore to the States today to meet the GST compensation shortfall. Out of this, an amount of ₹ 5,516.60 crore has been released to 23 States and an amount of ₹ 483.40 crore has been released to the 3 Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council. The remaining 5 States, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation.

Till now, 70 percent of the total estimated GST compensation shortfall has been released to the States & UTs with Legislative Assembly. Out of this, an amount of ₹ 71,099.56 crore has been released to the States and an amount of ₹ 6,900.44 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 ₹ 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. 13 rounds of borrowings have been completed so far starting from 23^rd October, 2020.

The amount released this week was the 13^th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 5.3083%. So far, an amount of ₹ 78,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7491%. 

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 ₹ 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 18.01.2021

(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	1810.71
2	Arunachal Pradesh*	143	0.00
3	Assam	1869	779.08
4	Bihar	3231	3059.34
5	Chhattisgarh	1792	1354.08
6	Goa	446	658.04
7	Gujarat	8704	7225.36
8	Haryana	4293	3409.84
9	Himachal Pradesh	877	1345.31
10	Jharkhand	1765	735.60
11	Karnataka	9018	9721.07
12	Kerala	4,522	2839.56
13	Madhya Pradesh	4746	3558.75
14	Maharashtra	15394	9384.47
15	Manipur*	151	0.00
16	Meghalaya	194	87.69
17	Mizoram*	132	0.00
18	Nagaland*	157	0.00
19	Odisha	2858	2994.61
20	Punjab	3033	4116.44
21	Rajasthan	5462	2912.32
22	Sikkim*	156	0.00
23	Tamil Nadu	9627	4890.14
24	Telangana	5017	1336.44
25	Tripura	297	177.30
26	Uttar Pradesh	9703	4706.53
27	Uttarakhand	1405	1814.82
28	West Bengal	6787	2182.06
	Total (A):	106830	71099.56
1	Delhi	Not applicable	4595.25
2	Jammu & Kashmir	Not applicable	1780.05
3	Puducherry	Not applicable	525.14
	Total (B):	Not applicable	6900.44
	Grand Total (A+B)	106830	78000.00

* These States have ‘NIL’ GST compensation gap

Special borrowing window for GST compensation enables state funding; latest instalment released and additional borrowing permission granted The Department of Expenditure released the latest weekly instalment under a central special borrowing window created to meet the GST compensation shortfall, bringing cumulative pass through borrowings to States and UTs to seventy eight thousand crore at an average interest rate of 4.7491%; the most recent borrowing was at 5.3083%. Separately, the Central Government authorised additional borrowing permission of 0.50% of GSDP for States choosing Option I, and permission for the full additional amount was granted to twenty eight States; five States reported no GST compensation gap.