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Wednesday, June 29, 2022

‘20 states express interest to avail extra borrowing’

The Ministry of Finance had launched a programme in June last year to allow additional borrowing space of Rs 80,000 crore to states, which is conditional on them undertaking and sustaining specific reforms in the power sector.

By: ENS Economic Bureau | New Delhi |
January 19, 2022 3:00:41 am
state borrowings, Ministry of finance, Andhra Pradesh, India news, Indian express, Indian express news, current affairsAndhra Pradesh is the only state to succeed in getting over Rs 2,100 crore under the programme, the statement added. (File)

AS MANY as 20 states have shown interest for getting additional borrowing space for the power sector under a central scheme.

The Ministry of Finance had launched a programme in June last year to allow additional borrowing space of Rs 80,000 crore to states, which is conditional on them undertaking and sustaining specific reforms in the power sector.

REC Ltd is working as nodal agency for implementation of the scheme, for the Ministry of Power. A statement issued by the Power Ministry on Tuesday said, “This financial year (2021-22), almost 20 states have already shown interest in taking benefit under the scheme.”

Andhra Pradesh is the only state to succeed in getting over Rs 2,100 crore under the programme, the statement added. “Based on the recommendations of Ministry of Power in respect of such proposal from Andhra Pradesh state, Ministry of Finance had accorded their approval and the state has already availed borrowings of more than Rs 2100 crore, to partly utilise such allowed additional borrowing space,” it noted.

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Manipur and Rajasthan’s proposals are also under active consideration at the Finance Ministry, both of which may be eligible for the maximum limit of 0.50 per cent increased borrowing space, based on reforms carried out by them. Rest of the states are also submitting their proposals.

Under the programme, the additional borrowing limit permitted for power sector reforms is 0.5 per cent of Gross State Domestic Product.

This being the first year (2021-22) of the current version of the scheme, the requirements of reforms and actions has been kept less onerous, with the bar raised for future years, pushing the states towards higher level reforms, it added.

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