Speed up capex to get loan, states told

TO ENSURE STATES don't cut back on their capital expenditure, the Centre has linked a third of the 'untied' part of the capex loan to them in FY24, to achievement of their individual capex targets in the year. Of the ₹1.3 trillion loan, 1 trillion is untied, while the balance is linked to reforms and other criteria specified by the Centre.

- PRASANTA SAHU

The 50-year interest-free capex support to states in FY24 is 71% higher than the FY23 revised estimate of ₹76,000 crore.

The untied portion of 1 trillion in FY24 would be allocated among states in proportion to their share of central taxes and duties as per the award of the 15th Finance Commission. Accordingly, Uttar Pradesh, with a share of ₹17,939 crore, would be the top beneficiary, followed by Bihar (₹10,058 crore) and West Bengal (₹7,523 crore).

The untied funds would be released to states in three equal instalments. The first instalment of 33.3% (₹33,300 crore) would be released to each state government on meeting three basic conditions: adhering to branding norms for central schemes, sharing of scheme-wise spending data, and proof of deposit of the Centre's share of the interest earned in Single Nodal Agency (SNA) account for each scheme. The interest in floating funds with SNAs could fetch the Centre ₹1,000 crore in revenue in FY24, an official said.