Eleven states have managed to meet the capital expenditure target set by the Finance Ministry for the first quarter of the current fiscal (2021-22).
The successful states include Andhra Pradesh, Bihar, Chhattisgarh, Haryana, Kerala, Madhya Pradesh, Rajasthan and Uttarakhand among others. The ministry had set the deadline for meeting the target, as the first quarter of 2021-22.
These states have become eligible to borrow an additional sum of Rs 15,721 crore, as an incentive for meeting the capital expenditure target.
This additional amount is equivalent to 0.25 per cent of the gross state domestic product of these eleven states, according to a statement issued by the Finance Ministry.
The additional funds will help these states in meeting their capital expenditure further.
The capital expenditure increases the future productive capacity of the economy and results in a higher rate of economic growth.
The states' eligibility for seeking higher borrowing entailed achieving at least 15 per cent of the target set for 2021-22 by the end of April-June quarter of 2021-22, 45 per cent by July-September quarter, 70 per cent by the end of October-December quarter and 100 per cent by the end of the fiscal, i.e. January-March quarter.