: West Bengal & Kerala agree to tap special borrowing window to bridge GST shortfall #FinanceIndia #StockMarketNEWS West Bengal & Kerala agree to tap special borrowing window to bridge GST shortfall

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West Bengal & Kerala agree to tap special borrowing window to bridge GST shortfall #FinanceIndia #StockMarketNEWS
West Bengal & Kerala agree to tap special borrowing window to bridge GST shortfall New Delhi, Nov 26 (KNN) West Bengal and Kerala have accepted the Centre’s proposal to meet the shortfall in revenue to compensate states for implementing the Goods and Services Tax (GST) through a special borrowing window.

“Kerala and West Bengal will get Rs 10,197 crore through the special borrowing window to meet the GST implementation shortfall and permission to raise an additional Rs 11,309 crore through borrowings,” the Finance Ministry said on Wednesday.

The states & union territories who choose Option-1 are getting the amount of shortfall arising out of GST implementation through a special borrowing window put in place by the Government of India. The window has been operationalized since October 23rd, 2020 and the centre has already borrowed an amount of Rs 24,000 crore on behalf of the states in four instalments and passed it on to the states and union territories, who chose Option -1 on October 23rd, 2020, November 2nd, 9th and 23rd, 2020.

Under the terms of Option-1, besides getting the facility of a special window for borrowings to meet the shortfall arising out of GST implementation, the states are also entitled to get unconditional permission to borrow the final instalment of 0.50 per cent of Gross State Domestic Product (GSDP) out of the 2 per cent additional borrowings permitted by the Government of India, under Atmnirbhar Abhiyaan on 17th May, 2020. This is over and above the Special Window of Rs 1.1 lakh crore.

On receipt of the choice of Option-1 from the Kerala and West Bengal, the centre has granted additional borrowing permission of Rs 4,522 crore to the Kerala government (0.5 per cent of Kerala’s GSDP) and Rs 6,787 crore to the West Bengal government (0.5 per cent of West Bengal’s GSDP) .

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