If the decision is not made in favor of the states, the Supreme Court can go to the case
States opposing the option of compensating the revenue deficit by borrowing say that the central government should take full debt and pay compensation to the states. Kerala Finance Minister Thomas Isaac said, 10 states are demanding to pay the full amount on behalf of the central government in the current year according to the conditions. For this, the center should take a loan. Also warned that if the Center refuses to set up the Dispute Resolution Mechanism and tries to pass the option of borrowing through voting then the Supreme Court will be approached.
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According to the central government, there is a shortfall of Rs 2.35 lakh crore in the GST collection. Of this, GST owes Rs 97,000 crore, while the rest is due to corona virus. On October 5, Finance Minister Nirmala Sitharaman announced that the states would be given Rs 20,000 crore by late night. Explain that in the Council meeting held in August 2020, the Center suggested two options to compensate for GST. One, the states will be provided with a special window, under which they can take loans from the Reserve Bank of India (RBI). In this, the states can get a loan of Rs 97,000 crore at a lower interest rate. This amount can be deposited from the cess collection till 2022.
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10 non-BJP ruled states denied borrowing option
The Center had said as an alternative to the other that a loan of Rs 2.35 lakh crore can be taken under the special window. 21 states of the country are supporting this issue. By the middle of September, he had a chance to take a loan of Rs 97,000 crore by opting for the option. However, 10 non-BJP ruled states refused to accept this option. He says that the Center should compensate them for GST compensation by taking loans. So far Andhra Pradesh, Arunachal Pradesh, Assam, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Karnataka, Madhya Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Odisha, Puducherry, Sikkim, Tripura, Uttarakhand and U.P. Have chosen the loan option.