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Informist, Tuesday, Jul 23, 2024

--BUDGET: 1.5 trln rupees for long-term interest-free state loans 

--BUDGET: Earmarked significant amount for state capex loans 

NEW DELHI – The government today pegged 1.50 trln rupees as interest-free loans to states for capital expenditure in 2024-25 (Apr-Mar). This is 20 bln rupees more than the 1.30 trln rupees announced in the Interim Budget in February. The government had provided 1.06 trln rupees as loans to states for capital expenditure in 2023-24, according to the revised estimates.

"We will encourage states to provide support of similar scale for infrastructure, subject to their development priorities," Finance Minister Nirmala Sitharaman said, presenting the Budget today, adding that this allocation is likely to support states in their resource allocation. 

The government had, in 2023-24, tied a portion of the loan to initiatives like urban planning, vehicle scrapping, and improving creditworthiness of urban local bodies for issuance of municipal bonds.

Under the capital expenditure loan scheme, the Centre provides 50-year interest-free loans to states for capital expenditure. The Centre has been progressively increasing the outlay for the scheme, announced in 2021-22.  End

Reported by Krity Ambey and Sayantan Sarkar

Edited by Avishek Dutta

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