Centre earmarks Rs 80,000 crore interest-free loans for states undertaking capital works in FY'23
The Centre has earmarked Rs 80,000 crore as interest-free loans for states undertaking capital works in the current fiscal.
In her 2022-23 Budget speech, Finance Minister Nirmala Sitharaman announced the 'Special Assistance to States for Capital Investment' scheme under which total financial assistance of Rs 1 lakh crore would be given to states in the form of 50-year interest-free loans for capital investment projects.
Issuing the guidelines for implementing the scheme, the finance ministry said Rs 80,000 crore is reserved for capital works to be undertaken by the states.
To avail of the benefit for investments made this fiscal, states will have to submit details like the name of the project, capital outlay, completion period, and its economic justification to the expenditure department of the Union finance ministry.
''… states are required to submit capital works proposed to be taken up by them in 2022-23… to the Department of Expenditure for approval and release of funds,'' the expenditure department said in a letter dated April 6 sent to all state governments.
The 'Special Assistance to States for Capital Investment' scheme also includes Rs 5,000 crore interest-free loans which would be provided to incentivize states to undertake privatization or disinvestment of state public sector enterprises and asset monetization.
Under this head, states would be incentivized to privatize or undertake strategic sales along with transfer of management control of state PSUs besides a listing of PSUs on the stock exchanges.
Such incentives to a particular state would be limited to Rs 1,000 crore, the expenditure department added.
In her budget speech, Sitharaman announced that the 'Special Assistance to States for Capital Investment' scheme allocation will be used for PM Gati Shakti-related and other productive capital investments of the states.
Besides, the allocation would be made for digitization of the economy, including digital payments and completion of the optical fiber cable network, and reforms related to building bye-laws, town planning schemes, transit-oriented development, and transferable development rights.
The total Rs 1 lakh crore scheme also includes Rs 4,000 crore for PM Gram Sadak Yojana, Rs 2,000 crore digitization incentive, Rs 6,000 crore towards urban reforms, and Rs 3,000 crore for capital projects on the optical fiber cable.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)