Watch experts decode 'The rise of ESG investing' on October 29 at 4pm. Register Now!
Last Updated : Sep 24, 2020 07:52 PM IST | Source: PTI

Centre allows additional borrowing of Rs 9,913 crore by five states

In view of the unprecedented COVID-19 pandemic, the Centre had in May allowed additional borrowing limit of up to 2 per cent of Gross State Domestic Product (GSDP) to states for the year 2020-21 with certain conditions.


The Centre on September 24 permitted five states to go for additional borrowing of Rs 9,913 crore through Open Market Borrowings (OMBs) to meet their expenditure requirements amid falling revenues due to the COVID-19 crisis.  These states are Andhra Pradesh, Telangana, Goa, Karnataka and Tripura.

The permission has been accorded after these states successfully met the reform condition of implementation of 'One Nation One Ration Card' system, an official statement said.

The Department of Expenditure, under the Finance Ministry, has accorded approval to Karnataka for additional borrowing of Rs 4,509 crore, followed by Telangana (Rs 2,508 crore) and Andhra Pradesh (Rs 2,525 crore).

Goa intends to raise Rs 223 crore while Tripura Rs 148 crore, it said.


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

COVID-19 Vaccine

Frequently Asked Questions

View more
How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

View more

Of the extra 2 percent, only 0.5 percent is unconditional. After that, states will be allowed four increments of 0.25 percent subject to implementation of four specific state-level reforms, where weightage of each reform is 0.25 percent of GSDP. The four reforms are -- implementation of 'One Nation One Ration Card' system; ease of doing business reforms; urban local body/utility reforms; and power sector reforms by privatising power distribution.

"The remaining additional borrowing limit of 1 per cent was to be released in two instalments of 0.50 percent each - first immediately to all the States as untied, and the second on undertaking at least 3 out of the above mentioned reforms," it said.

The Government of India has already granted permission to states to raise the first 0.50 percent as OMB in June 2020. This made an additional amount of Rs 1,06,830 crore available to the states.  State net borrowing ceiling for 2020-21 is Rs 6.41 lakh core (3 percent of GSDP).
First Published on Sep 24, 2020 07:50 pm