|
Lok Sabha
The aggregate gross fiscal deficit of all States, including the National Capital Territory (NCT) of Delhi has been estimated at Rs.1,41,010 crore in 2003-04 (RE). This constituted 5.1% of GDP.
Consequent to the acceptance of the recommendations of the Twelfth Finance Commission (TFC), Government of India has formulated a scheme “The States’ Debt Consolidation and Relief Facility (DCRF).” TFC has recommended that the central loans to States contracted till 31.3.04 and outstanding on 31.3.05 may be consolidated and rescheduled for a fresh term of 20 years (resulting in repayment in 20 equal installments), and an interest rate of 7.5 per cent be charged on them. The scheme of write-off shall be available for all States from the year they have qualified for the general debt relief by enacting the fiscal responsibility legislation. The quantum of write-off of repayment will be linked to the absolute amount by which the revenue deficit is reduced in each successive year during the award period from the base level of revenue deficit compiled by TFC. In effect, if the revenue deficit is brought down to zero in 2008-09, the entire repayments during the period will be written-off.
Shri Palanimanickam, Minister of State for Finance gave this information in reply to a question raised by Shri Mohan Singh.
BSC/BY/GN-275/05
|
