15th Instalment of ₹ 6,000 crore released to the States to meet the GST compensation shortfall.

A total amount of ₹ 90,000 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 15^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, 81 percent of the total estimated GST compensation shortfall has been released to the States & UTs with Legislative Assembly. Out of this, an amount of ₹ 82,132.76 crore has been released to the States and an amount of ₹ 7,867.24 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. 15 rounds of borrowings have been completed so far starting from 23^rd October, 2020.

The amount released this week was the 15^th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 5.5288%. So far, an amount of ₹ 90,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7921%. 

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 12.02.2021

(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	2062.35
2	Arunachal Pradesh*	143	0.00
3	Assam	1869	887.32
4	Bihar	3231	3484.54
5	Chhattisgarh	1792	1692.60
6	Goa	446	749.50
7	Gujarat	8704	8229.50
8	Haryana	4293	3883.70
9	Himachal Pradesh	877	1532.27
10	Jharkhand	1765	919.50
11	Karnataka	9018	11071.99
12	Kerala	4,522	3467.40
13	Madhya Pradesh	4746	4053.31
14	Maharashtra	15394	10688.59
15	Manipur*	151	0.00
16	Meghalaya	194	99.89
17	Mizoram*	132	0.00
18	Nagaland*	157	0.00
19	Odisha	2858	3410.77
20	Punjab	3033	5026.60
21	Rajasthan	5462	3413.62
22	Sikkim*	156	0.00
23	Tamil Nadu	9627	5569.70
24	Telangana	5017	1595.58
25	Tripura	297	201.90
26	Uttar Pradesh	9703	5360.61
27	Uttarakhand	1405	2067.00
28	West Bengal	6787	2664.52
	Total (A):	106830	82132.76
1	Delhi	Not applicable	5233.87
2	Jammu & Kashmir	Not applicable	2027.43
3	Puducherry	Not applicable	605.94
	Total (B):	Not applicable	7867.24
	Grand Total (A+B)	106830	90000.00

* These States have ‘NIL’ GST compensation gap

Special borrowing window for GST compensation supplies instalments to states and permits additional borrowing to cover revenue shortfalls. The Government released the 15th weekly instalment under the special borrowing window, with funds raised by the Central Government on behalf of States/UTs passed through to meet the GST compensation shortfall. The financing comprises borrowings through the special window and an additional borrowing permission equal to 0.50% of GSDP granted to States choosing the prescribed option; a state-wise schedule shows amounts allowed and funds passed on, and five States reported no compensation gap.