BHUBANESWAR: Odisha on Friday received over Rs 3,033 crore from the Centre as part of back-to-back loans to states under the special borrowing window as compensation to meet the GST shortfall.
The payment has been made in two instalments. While the first instalment was Rs 2,770.23 crore, the second tranche was Rs 262.87 crore. This was in addition to normal GST compensation being released every two months out of actual cess collection.
Of Rs 75,000 crore released by the Department of Expenditure of the Ministry of Finance to the states and UTs, sources said Odisha has been paid a total of Rs 3,033.1 crore, which is almost half of the total shortfall for the entire year.
As the State government had opted for Option-I that allowed the Centre for market borrowing to meet the GST shortfall caused by the Covid-19 pandemic, it continues to receive compensation since October last. For the second financial year in a row, the Centre has been borrowing under a special, relatively low-cost mechanism to bridge a yawning shortfall in the GST compensation cesspool and transfer the funds as loans sans any consequent fiscal cost to states.