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Economy & Business

Government distributes revenue deficit grants of Rs. 7,183 billion to 14 states

The Hawk
November7/ 2022

New Delhi (The Hawk): The central government announced on Thursday a post-devolution revenue deficit grant of Rs 7,183.42 crore to 14 states, including Kerala, Punjab, Rajasthan, Himachal Pradesh, and West Bengal, for the month of October.

The Ministry of Finance's Department of Expenditure has released the seventh monthly tranche of the Post Devolution Revenue Deficit (PDRD) Grant of Rs 7,183.42 crore to 14 states. The fund was made available in accordance with the recommendations of the Fifteenth Finance Commission, according to a statement issued by the Union Finance Ministry.

For the fiscal year 2022-23, the Fifteenth Finance Commission has recommended a total Post Devolution Revenue Deficit Grant of Rs 86,201 crore to 14 states. The recommended award is distributed to the recommended states in 12 equalised monthly payments by the Department of Expenditure.

The total amount of Revenue Deficit Grants awarded to States in 2022-23 has increased to Rs 50,282.92 crore with the distribution of the 7th instalment for the month of October 2022.

Article 275 of the Constitution provides for Post-Devolution Revenue Deficit Grants to the states. The grants are distributed to the states in accordance with the recommendations of successive Finance Commissions in order to close the deficit in the states' revenue accounts following devolution.

The Fifteenth Finance Commission determined the eligibility of states to receive this grant and the quantity of grant for the period 2020-21 to 2025-26 based on the difference between the State's assessed revenue and expenditure after taking into account the assessed devolution during this time.

Andhra Pradesh, Assam, Himachal Pradesh, Kerala, Manipur, Meghalaya, Mizoram, Nagaland, Punjab, Rajasthan, Sikkim, Tripura, Uttarakhand, and West Bengal have been proposed by the Fifteenth Finance Commission for Post Devolution Revenue Deficit Grant for 2022-23.

West Bengal has received the most money. West Bengal has got Rs 1,132.25 crore as the seventh instalment for the fiscal year 2022-23. The whole amount comes to Rs 7,925.75 crore. The Post Devolution Revenue Deficit (PDRD) Grant primarily benefits Kerala, Andhra Pradesh, Himachal Pradesh, and Punjab.

(Inputs from Agencies)