Centre permits Goa to borrow additional Rs 223 crore in FY21

PANAJI: The Centre granted five states, including Goa, permission to raise additional funds through open market borrowings for successfully implementing the one nation one ration card system. The Union ministry of finance’s department of expenditure has permitted Goa to borrow an additional Rs 223 crore in 2020-21, which will come as a relief for the state which is facing a fund crunch during the Covid pandemic.

Andhra Pradesh, Telangana, Goa, Karnataka and Tripura have been permitted to raise a total of Rs 9,913 crore for successfully implementing the one nation one ration card reforms.
Under the one nation one ration card initiative, eligible beneficiaries would be able to avail food grains under the National Food Security Act (NFSA) from any fair price shop in the country using the same ration card.
In May, because of the pandemic-induced economic crisis, the Centre increased the borrowing limit for states to 5% of the GSDP for the year 2020-21. However, the additional borrowing came with a rider that states need to implement four specific state-level reforms — one nation one ration card system, ease of doing business reforms, urban local body or utility reforms and power sector reforms.
Each reform was given a weightage of 0.25% of GSDP.
Goa’s borrowing limit enhanced to Rs 3,000 crore
The additional borrowing limit was to be released in two instalments, first immediately as untied funds and the second on undertaking at least three of the four mentioned reforms. The Centre had already granted permission to states to raise the first tranche of open market borrowing in June.
Goa is facing a severe shortage of funds due to the pandemic. With Rs 1,018 crore owed by the Centre as GST compensation, Goa has been forced to borrow Rs 1,500 crore, which is half of the borrowing limit fixed for the state.
The state’s borrowing limit has now been enhanced to Rs 3,000 crore for the current financial year.