Centre Releases Rs 1779 Cr Compensation To Odisha To Meet GST Shortfall

New Delhi: The Centre on Thursday released Rs 1779.45 crore to Odisha towards ‘Back to Back Loan’ in lieu of GST compensation shortfall.

The Ministry of Finance released total ₹44,000 crore to the states and Union Territories under the facility. The amount is funded from borrowings of the Centre in 5-year securities issued in the current financial year, at a weighted average yield of 5.69%.

The fund is meant to help the states/UTs plan their public expenditure for improving health infrastructure and taking up infrastructure projects.

Earlier, the Centre had released Rs 1,15,000 crore including Rs 75,000 crore on July 15 and Rs 40,000 crore on October 7. With today’s release, total amount released in the current financial year as back-to-back loan in-lieu of GST compensation has gone up to Rs 1,59,000 crore. This release is in addition to normal GST compensation being released every 2 months out of actual cess collection.

The Centre had released Rs 1617.65 crore to Odisha on October 7. Of this amount, Rs 950.37 crore was released under five-year tenor and Rs 667.28 crore under 2-year tenor.

It may be noted that at the GST Council meeting on May 28, it was decided by the Central Government that it would borrow ₹1.59 lakh crore in 2021-22 and release it to the states and UTs on a back-to-back basis to meet the resource gap.

Also Read: Centre Releases Rs 1617 Crore To Odisha To Meet GST Compensation Shortfall