Higher monthly instalment of devolution amount of ₹95,082 crore will be released, says Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman said the amount will be released by November 22.

Union Finance and Corporate Affairs Minister Nirmala Sitharaman, on November 15, briefed the media after a meeting with State Chief Ministers and Lieutenant Generals of Union Territories.

Ms. Sitharaman said “Nearly 15 State Chief Ministers participated, LG of J&K, deputy CMs of three States and Finance Ministers of the rest also joined us. The Context of the meeting was that after the second wave, we are seeing a robust growth. However, it’s also a time where we are looking at ways in which we need to sustain the growth, take it as close as possible to a double digit growth for which the Centre and States have to work together.”

The Finance Minister said “In most of the issues related to investment, development and manufacturing activities, it is the States who are doing work at the forefront. The support from the Centre is always there. But we also wanted to make sure that the States’ understanding and the issues they want to discuss must be heard and that’s the reason this meeting was called.”

She added “Therefore, I must put it upfront that we have had very key ideas coming from States. There were also generic requests that were posed. I am not going through each of these ideas.”

Ms. Sitharaman further said “One of the examples I would like to take is the way in which some of the states have given approvals for projects, they were looking for better dispute resolution mechanisms post the award of the contract, enhancing road connectivity, some of the North East States came up with specific suggestions for immediate job creation in their States…”

She pointed out “And State-specific international trade policies for the North-East. So I have listed it out. The need for a policy for offshore wind energy generation was highlighted by some States. So it was a very useful session where clearly, the way in which we want to move forward is to ensure that the understanding that the States have of their way of wanting to move forward post the pandemic, with the people of India showing greater aspiration to want to come out of the pandemic and clearly push towards better and speedier growth, it was just a timely meeting we had with the States.”

Ms. Sitharaman said “Detailed notes have been taken of the oral content of the ministers, but we have requested each one of them to send a written note as well.”

The Union Finance Minister said “One of the things which States have been talking about is the way in which this year, we have front-loaded many of the dues that have to go to the States, that has been recognised and also, there were at least a few kept saying that the capital expenditure money given to them almost like a grant for the 50 years that they can use interest free and return 50 years later, has been well received.”

“Many openly said they would want the scheme to continue because the emphasis is on capital expenditure. Unless States and the Centre put up money for building, the ripple effects for speedier and better growth would not be as desirable as we wish to have it and therefore, that expenditure is absolutely necessary,” said Ms. Sitharaman.

The Corporate Affairs Minister said “You are aware that the GST compensation agreed upon for this year has already been given by early November. Similarly, today, some of the CMs requested, for increasing their capex, it would be really helpful for them to get a part of the revenue devolution for the current financial year also in a sense – if it can be frontloaded, it will be helpful. There, of course, I have directed the Finance Secretary to do this immediately as this is an exceptional year and States would not be short of money in their hands when all of us are pushing forward the infrastructure expenditure to be taken up by them.”

Ms. Sitharaman said “I have suggested to the Finance Secretary, that in this month, to be specific, on November 22, instead of the normal monthly installment of devolution amount which is normally ₹47, 541 crore, to release another ₹47,541 crore, so a total of ₹95,082 crore will be given to the States.

“With that, the desire of the States to have some more money in the hands so that they can easily consider spending it for infrastructure creation, will be met.”

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