Centre Releases Rs 6,195 Crore As Grants To 14 States
These grants cover the deficit on post-devolution of revenue, or revenue deficit, to the 14 states for May.
The central government has released Rs 6,195 crore as grants to fourteen states as per the recommendations of the 15th Finance Commission.
These grants cover the deficit on post-devolution of revenue, or revenue deficit, to states including West Bengal, Himachal Pradesh, Kerala, among others, for May. Revenue deficit is the difference between states’ revenue and expenditure.
This is the second monthly installment of the post-devolution revenue deficit grant as recommended by the 15th Finance Commission, according to a tweet by Finance Minister Nirmala Sitharaman’s office. The same amount was transferred to these 14 states in April.
“This would provide them additional resources during the Corona crisis,” the tweet said.
This comes at a time when states have been asking the centre to clear all pending dues to them, including GST compensation, as a nationwide lockdown, and a fight against the virus has dried their revenues. The chief ministers of Punjab and Maharashtra, at a meeting with Prime Minister Narendra Modi today, asked for immediate release of states’ pending compensation. The centre owes over Rs 30,000 crore as GST compensation to states for December and January alone. The amount is set to significantly increase from February as goods and services tax collections will be hit the most since the lockdown started on March 24.
The 15th Finance Commission had estimated these fourteen states will need revenue deficit grants amounting to Rs 74,340 crore in 2020-21, according to its report for the current financial year.