Finance Ministry of India gave options to the states to borrow funds. And these will act as a way to cover the shortfall in revenue. And some states already chose option 1 given by the government. But some of them are still demanding the center to borrow funds itself. And itis not possible, so the center is rigid on its two options. Latest state to choose option 1 is Rajasthan.
Recently, RBI opened its special window for the states. And in this Puducherry was the one who borrowed funds under the options one given by the government. After this, Rajasthan is coming forward. Rajasthan is choosing option one for the funds. It is the latest opposing ruled state that is choosing the borrowing option one. This option one is borrowing Rs 97,000 crore from a special window facilitated by the Reserve Bank of India.
Official Statement for Rajasthan Choosing Option 1
“The Government of Rajasthan has communicated its acceptance for Option 1 out of the two options suggested by the Ministry of Finance to meet the shortfall in revenue arising out of GST implementation,” the Finance Ministry said in a release. After this, Rajasthan will get Rs 4,604 crore from the RBI window.
States that are yet to choose from the options are Kerala, Punjab, West Bengal, Chhattisgarh, Jharkhand. As they are asking the center to borrow funds itself and then give to them. And after Rajasthan in total 22 states and 3 union territories (UTs) are choosing option 1.
Funds Given Yet to the States
Under the extraordinary window, the Center has just obtained a measure of Rs 12,000 crore in two portions and gave it to 21 states and 3 UTs on October 23 and November 2. Of this sum, Karnataka, Maharashtra, and Gujarat have gotten Rs 1,872 crore, Rs 1,808 crore, and Rs 1,391 crore, individually. “The following portion of borrowings is probably going to be delivered on November 9, 2020,” the Finance Ministry said.
The service had a month ago said that the Center would get from the market and afterward go about as a delegate to orchestrate consecutive credits to pay the GST remuneration shortage of Rs 1.1 lakh crore to state governments.
In August, the Center gave two choices to states — either obtain Rs 97,000 crore from an uncommon window encouraged by the Reserve Bank of India or acquire Rs 2.35 lakh crore from the market. The choices have since been changed to Rs 1.10 lakh crore and Rs 1.8 lakh crore, separately.