The Indian government has released the third instalment of tax devolution to the states, amounting to a sum of INR 1,18,280 crore. This is higher than the usual monthly devolution of INR 59,140 crore. The states of Uttar Pradesh and Bihar received the highest instalments of INR 21,218 crore and INR 11,897 crore respectively.
To enable the country’s states to expedite capital spending, finance development and welfare-related expenditure, resources have been made available for priority projects and schemes. One advance instalment has been released in addition to the regular instalment due in June 2023, officials say.
This move is likely to buoy the financial health of various states which have been grappling with budget issues presented due to the deadly COVID-19 pandemic outbreak. The Centre has also urged the states to spend the money on priority projects and schemes, so that it will help in their economic rejuvenation.
States have faced a loss of revenue from many sources during the pandemic outbreak, which has created significant financial difficulties for them. The Centre has been attempting to provide support to help bring these states back to economic normalcy.
This release of funds will substantially help these states in carrying out necessary development work and welfare-related expenditure.
