NEW DELHI: The Ministry of finance on Saturday said that the state of Rajasthan has become eligible for an additional open market borrowing of Rs 2,731 crore after the state successfully implemented ease of doing business measures.
This grant takes the total additional borrowings allowed under this category to Rs 19,459 crore.
“Rajasthan has now joined the five other States namely, Andhra Pradesh, Karnataka, Madhya Pradesh, Tamil Nadu and Telangana, who have achieved this feat. On completion of reforms facilitating ease of doing business, these six States have been granted additional borrowing permission of Rs 19,459 crore,” the finance ministry said in a statement on Saturday.
On May 17, 2020, while announcing the Aatmanirbhar package, finance minister Nirmala Sitharaman had said that states were permitted to raise an additional 2 per cent over and above 3 per cent of the GSDP mandated under the Fiscal Responsibility and Budget Management (FRBM) Act.
However, half of these of additional borrowing permissions would only be granted if the states completed reforms to facilitate ease of doing business.
The first 0.5 per cent can be borrowed without any condition, while next 0.5 per cent would have to be made through the options offered by the Centre to meet the GST compensation shortfall.
For the remaining 1 per cent, each of the four categories of reform measures would enable an additional borrowing og 0.25 per cent.
This would make a total of Rs 2.14 lakh crore available for states which are able to meet all conditions.
The four identified citizencentric areas for reforms were: the implementation of One Nation One Ration Card system, ease of doing business reforms, urban local body, or utility sector and power sector reforms.
Till date, 10 states have implemented the One Nation One Ration Card system and six states have received borrowing permission after satisfying ease of doing business conditions.
Citizen-centric reform measures
Apart from Rajasthan’s grant, additional borrowing permissions worth Rs 50,253 crore has been issued to the states which have undertaken the various citizen-centric reforms, the government says.