Ministry of Finance approved capital expenditure projects of ₹ 2,903.80 crore in 8 States

Ministry of Finance approved capital expenditure projects of ₹ 2,903.80 crore in 8 States

₹ 1,393.83 crore released to 8 States

Scheme “Special Assistance to States for Capital Expenditure for 2021-22” gives timely stimulus to economic recovery

The Department of Expenditure, Ministry of Finance, has approved capital projects of ₹ 2,903.80 crore in 8 States under the scheme entitled ‘Special Assistance to States for Capital Expenditure for 2021-22’. The Ministry has also released an amount of ₹ 1,393.83 crore to these States namely Bihar, Chhattisgarh, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Sikkim and Telangana.

State-wise amount approved and released is as under;

(Rs. in crore)

In view of a higher multiplier effect of capital expenditure and to provide the much needed resources to the State in the wake of 2^nd wave of the COVID-19 pandemic, the scheme ‘Special Assistance to States for Capital Expenditure for 2021-22' was launched on 29^th April, 2021. Under the scheme, special assistance is being provided to the State Governments in the form of 50-year interest free loan up to an overall sum not exceeding ₹ 15,000 crore during the financial year 2021-22. The scheme has three Parts:

Part-I: This part of the scheme is for the 8 North East States i.e. Assam, Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland, Sikkim and Tripura, and for the hill States of Uttarakhand and Himachal Pradesh. Under this part, ₹ 200 crore has been allocated each of the 7 North-East States and ₹ 400 crore each has been allocated to the States of Assam, Himachal Pradesh and Uttarakhand.

Part-II: This part of the scheme is for all other States not included in Part-I. An amount of ₹ 7,400 crore is allocated for this part. This amount has been allocated amongst these States in proportion to their share of central taxes as per the award of the 15^th Finance Commission for the year 2021-22.

Part-III: This part of the scheme is for providing incentives to State Governments for privatization/disinvestment of the State Public Sector Enterprises (SPSEs) and monetization/recycling of assets.  Under this part, States will be provided additional funds under the scheme over and above their allocation under Part-I or Part-II. An amount of ₹ 5,000 crore is allocated for this part of the scheme. For this part, there is no State specific allocation and funds will be provided on “First-come First-served basis”. 

A similar scheme entitled ‘Special Assistance to States for Capital Expenditure for 2020-21' was also launched by the Ministry of Finance in the last financial year. Under the scheme, capital expenditure proposals of ₹ 11,911.79 crore of 27 States were approved by the Department of Expenditure and an amount of ₹ 11,830.29 crore was released to the States in 2020-21.