Kerala, West Bengal opt for Centre's special GST compensation window

That leaves only Punjab, Jharkhand and Chhattisgarh, which are yet to agree to the Centre's proposal

Kerala and West Bengal have accepted the Centre’s option of a special window for compensation to states for their goods and services tax (GST) shortfall. This has brought the total number of states that have accepted this option to 25. Now there are only three – Punjab, Jharkhand and Chhattisgarh – that are yet to accept. Three Union Territories – Delhi, Jammu and Kashmir and Puducherry – have also decided in favour of the special window facilitated by the Centre.

The window, which totalled Rs 1.1 trillion, has been operationalised by the Centre since October 23. The Union government has already borrowed Rs 24,000 crore on behalf of states in four instalments and passed it on to states and UTs that have opted for this option. Now, Kerala and West Bengal will also receive funds through this route.

Besides this window, states are also entitled to an unconditional permission to borrow up to 0.5 per cent of their respective gross state domestic product (GSDP). But this permission is given only to those states that have opted for the special window. As such, Kerala has been given the permission to borrow Rs 4,522 crore and West Bengal Rs 6,787 crore from the markets.