GST Shortfall: Chhattisgarh Gives Up Dissent, Goes For Centre's Rs 1.1 Lakh Crore Borrowing Option

Chhattisgarh has joined the list of states which have given up dissenting against the Centre and opted for the Rs 1.1 lakh crore borrowing option extended by the Union government to address the shortfall in GST collection, reports the Economic Times.

As a result, the State government will be receiving Rs 3,109 crore through a special borrowing window. It will also be receiving permission to raise an additional sum of Rs 1,792 crore through borrowings (0.5 per cent of the State's GSDP).

With this, all of the States except Jharkhand and three Union Territories (UTs) have chosen to opt for Centre's offer after which the latter had started issuing the funds through back-to-back loans in weekly tranches through a special window coordinated by the Ministry of Finance.

As of yet, the MoF has already borrowed Rs 30,000 crore on behalf of the States in five tranches and passed it on. In addition to this, the amount of additional borrowing permission granted to 27 states stands at Rs 1,05,065 crore.

The development gains significance as the resolution shall help address the revenue gaps for the State governments at a time when the economy has begun to show signs of recovery from the COVID-19 created havoc.