New Delhi: With as many as 11 states including Andhra Pradesh, Bihar Madhya Pradesh and Manipur meeting capital expenditure (Capex) target in the April-June quarter of the current fiscal, the Centre has granted them permission to mobilise additional Rs 15,720 crore through open market borrowing.
To become eligible for incremental borrowing, states were required to achieve at least 15 per cent of the target set for 2021-22 by the end of the first quarter of 2021-22, 45 per cent by the end of the second quarter, 70 per cent by the end of the third quarter and 100 per cent by fiscal-end.
“The additional open market borrowing permission granted is equivalent to 0.25 per cent of their Gross State Domestic Product (GSDP). Additional financial resources thus made available will help the states in pushing their capital expenditure further,” Finance Ministry said in a statement.
The Centre would do the next review of state capex in December and the spending made during the second quarter will be assessed.
The third review will be done in the month of March, 2022 on the basis of capital expenditure incurred by states during the first three quarters of the year 2021-22.
“The capital expenditure-linked borrowing ceiling of 0.50 percent of GSDP will be allowed to those states who will achieve actual capital expenditure of at least 45 percent of the target by 30th September 2021 or 70 percent of the target by 31st December 2021, said the Finance Ministry.