Central Government borrows and transfers ₹ 6,000 crore as first tranche to 16 States on account of GST compensation under Special Borrowing Window

The Government of India has evolved a special borrowing window to addressthe shortfall in the GST collection during the year 2020 – 2021. 21 States and 2 Union Territories opted for this special window involving back-to-back borrowing coordinated by the Ministry of Finance.

Out of these, five States did not have any shortfall on account of GST compensation.  Today, the Central Government borrowed and transferred ₹ 6,000crores as first tranche to 16 States namely Andhra Pradesh, Assam, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Meghalaya, Odisha, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhandand 2 Union Territories: UT of Delhi and UT of Jammu and Kashmir.

The borrowing is at an interest rate of 5.19 percent.It is intended to make weekly releases of ₹ 6,000 croreto the States.Tenor of borrowing is expected to be broadly in the range of 3 to 5 years.