Centre revises guidelines for disbursal of state capex loans

Earmarks ₹87,000 cr for project-linked investments in FY26

- PRASANTA SAHU

THE CENTRE HAS issued new guidelines for the disbursal of ₹87,000 crore, or nearly 60% of the ₹1.5 lakh crore interest-free 50-year capex loans, to the state governments and Union territories for FY26.

The amount would be transferred to states and UTs largely as untied and project-linked loans.

The balance ₹63,000 crore capex loans will be linked to reforms, the guidelines for which would be issued later, sources told FE. For the first time, UTs have been included in the liberal capex-grant like loans scheme for spreading out capital assets across the country.

Of the ₹87,000 crore, ₹55,000 crore is earmarked for states and ₹2,000 crore has been allocated for the first time to UTs. The ₹55,000 crore has been allocated among states in proportion to their share of central taxes & duties as per the award of the 15 Finance Commission.

Of the ₹2,000 crore, ₹1,200 crore is earmarked for Jammu & Kashmir, ₹600 crore for Delhi and ₹200 crore for Puducherry.