The Finance Ministry in a statement said the amount released is about half of the Rs 1.59 lakh crore that was agreed to be borrowed in the current fiscal by the Centre and passed on to the states and Union Territories on a back-to-back basis to meet their resource gap. The amount released is in addition to the normal GST compensation that is paid bi-monthly to states out of the collections made from the levy of a cess on luxury and sin goods.
“The Ministry of Finance has released Rs 75,000 crore to the States and UTs with legislature under the backto-back loan facility in lieu of GST compensation. This release is in addition to normal GST compensation being released every 2 months out of actual cess collection,” the statement said. Finance Minister Nirmala Sitharaman in a tweet said, “Almost 50 per cent of the total shortfall for the entire year released in a single instalment.”