Kerala has received ₹313.92 crore from the ninth instalment released to the States by Union Finance Ministry as back to back loan to meet the Goods and Service Tax (GST) compensation shortfall.
Of the ₹6,000 crore provided to the States to meet the GST compensation shortfall, ₹5,516.60 crore has been released to 23 States and the balance ₹483.40 crore to the three Union Territories (UT) with Legislative Assembly-Delhi, Jammu & Kashmir & Puducherry-who are members of the GST Council. The other five States who had not been paid now do not have a gap in revenue on account of GST implementation.
Special window
The Union government had set up a special borrowing window in October 2020 to meet the estimated shortfall of ₹1.1 lakh crore in revenue arising on account of implementation of GST.
The ₹6,000 crore has been borrowed by Centre this week at an interest rate of 5.15 per cent.
So far, an amount of ₹54,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.74 per cent.
For the State, this is the fifth instalment of the dues after joining other States and UTs to accept Option I put forward by the Union government for meeting the GST compensation cess shortfall.
The Centre has already granted additional borrowing permission of ₹4,522 crore to Kerala (0.5 per cent of Kerala’s GSDP).
The State has got ₹1,583.88 crore as compensation, sources in the Finance Department said.
