New Delhi: Union Finance Minister Nirmala Sitharaman on Sunday said that the states have seen a sharp decline in the revenue and despite this the Centre has consistently extended generous support to states in this hour of need.
Devolution of taxes of Rs 46,038 crore in April was given fully as if Budget Estimates were valid, even though actual revenue shows unprecedented decline from Budget Estimates.
Revenue Deficit Grants to states of Rs 12,390 crores was given on time in April & May despite Centre’s stressed resources.
Over Rs 4,113 crore were released from Health Ministry for direct anti-COVID activities.
At the Centre’s interest, RBI has increased ways and means advance limits of States by 60 per cent, number of days state can be in continuous overdraft from 14 days to 21 days, and number of days state can be in overdraft in a quarter from 32 to 50 days.
States have so far borrowed only 14 per cent of the limit which is authorised to them. 86 per cent of the limit remains unutilised. Centre has decided to increase borrowing limits of states from 3 per cent to 5 per cent of Gross State Domestic Product (GSDP) for 2020-21.
This will give States extra resources of Rs 4.28 lakh crores.