Chhattisgarh has joined 26 States and 3 Union Territories (with legislatures) to go for ‘Option-1’ for meeting GST compensation shortfall. Now, only Jharkhand is yet to make a decision.
Chhattisgarh will get ₹3,109 crore through the special borrowing window to meet the GST implementation shortfall. The State will also have permission to raise additional ₹1,792 crore through special borrowing.
The States & Union Territories that chose Option-1 will get the amount of shortfall arising out of GST implementation through a special borrowing window put in place by the Centre. The window has been operationalised since October 23. The Centre has already borrowed an amount of ₹30,000 crore on behalf of the States in five instalments and passed it on to the States and Union Territories, that chose Option-1. Now, Chhattisgarh will receive funds raised through this window starting from the next round of borrowing.
Under the terms of Option-1, besides getting the facility of a special window for borrowings to meet the shortfall arising out of GST implementation, the States are also entitled to get unconditional permission to borrow the final instalment of 0.50 per cent of Gross State Domestic Product (GSDP) out of the 2 per cent additional borrowings permitted by the Centre, under Atmanirbhar Abhiyaan on May 17. This is over and above the Special Window of ₹1.1 lakh crore.