Centre allows UP, Andhra Pradesh to borrow Rs 7,376 cr more (Ld)

New Delhi, Oct 2 : The Centre has granted permission for an additional borrowing of Rs 7,376 crore to Uttar Pradesh and Andhra Pradesh for successfully undertaking reforms in the public distribution system and ‘ease of doing business’ respectively, the Ministry of Finance said on Friday.

The Ministry had earlier in the day said that it had allowed both the states to borrow Rs 7,106 crore more, but issued a corrigendum later to revise the amount to Rs 7,376 crore.

A Ministry statement said that Uttar Pradesh has become the sixth state to complete the PDS reform process under the ‘One Nation One Ration Card’ system. This made the state eligible to raise Rs 4,851 crore through Open Market Borrowings (OMBs).

It will help the state in mobilising additional financial resources required to fight COVID-19, it said.

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According to the Department of Food and Public Distribution, Uttar Pradesh, Andhra Pradesh, Telangana, Goa, Karnataka and Tripura have successfully carried out PDS reforms under the system.

Andhra Pradesh, it said, has become the first state in the country to successfully undertake “ease of doing business” reforms and thus become eligible to raise an additional Rs 2,525 crore through OMBs.

Earlier, the state had also completed PDS reforms as per the ‘One Nation One Ration Card’ system.

In view of the unprecedented COVID-19 pandemic, the Centre had in May, 2020 allowed an additional borrowing limit of up to 2 per cent of Gross State Domestic Product (GSDP) to the states for the year 2020-21. This made an amount up to Rs 4,27,302 crore available to the states.

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The scheme of raising additional amount had a clause which mandated that 1 per cent of this amount was subject to the implementation of four specific state-level reforms, where the weightage of each reform is 0.25 per cent of GSDP.

The four reforms are related to ‘One Nation One Ration Card’ system, ease of doing business, urban local bodies, and power sector.

Last week, the Ministry granted permission to five states, including Andhra Pradesh, to raise additional financial resources totalling Rs 9,913 crore through Open Market Borrowings. The other states were Telangana, Goa, Karnataka and Tripura.

Disclaimer: This story is auto-generated from IANS service.

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