Centre approves capital expenditure projects worth Rs 2,903.80 crore in 8 states

The Finance Ministry announced on Saturday that it has approved capital expenditure projects worth Rs 2,903.80 crore in eight states under the scheme entitled 'Special Assistance to States for Capital Expenditure for 2021-22'.

States named under this scheme are - Bihar, Chhattisgarh, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Sikkim and Telangana. The Ministry has already released Rs 1,393.83 crore to these states

Bihar has received the highest amount at Rs 415.50 crore and Rs 831 crore have been approved for the state by the Finance Ministry. Punjab has been allocated the least amount at Rs 45.80 crore The state had already received Rs 22.90 crore under the scheme.

The government had launched the 'Special Assistance to States for Capital Expenditure for 2021-22' scheme keeping in view a higher multiplier effect of capital expenditure and to provide much-needed resources to the states in the wake of the second wave of the COVID-19 pandemic. The scheme was launched on April 29, 2021.

Under the scheme, special assistance is being provided to states in the form of 50-year interest free loan up to an overall sum not exceeding Rs 15,000 crore during the financial year 2021-22, noted an official Finance Ministry statement. The scheme is made up of three parts.

The first part of the scheme is for eight North-East states i.e. Assam, Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland, Sikkim and Tripura, and for the hill states of Uttarakhand and Himachal Pradesh. Under this part, Rs 200 crore has been allocated to each of the 7 North-East States and Rs 400 crore each has been allocated to the States of Assam, Himachal Pradesh and Uttarakhand.

The second part is for all states not included in the first part. An amount of Rs 7,400 crore has been allocated for this part. "This amount has been allocated amongst these States in proportion to their share of central taxes as per the award of the 15th Finance Commission for the year 2021-22," read the statement.

The third part of the scheme is for providing incentives to states for privatisation and disinvestment of the State Public Sector Enterprises (SPSEs) and monetization/recycling of assets. Under this part, states will be provided additional funds under the scheme over and above their allocation under the first two parts.

An amount of Rs 5,000 crore has been allocated for this part of the scheme. For this part, there is no state-specific allocation and funds will be provided on a 'first come first serve' basis.

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