Finance Ministry approves Rs 56,415 crore to 16 states for capital investment

New Delhi, June 27 (KNN) The Department of Expenditure under the Finance Ministry has given a green light to the capital investment proposals of Rs 56,415 crore for 16 states in the current financial year 2023-24.

The capital investment proposal has been approved under the scheme titled ‘Special Assistance to States for Capital Investment 2023-24’. Under this scheme, assistance is being provided to the state governments in the form of 50-year interest free loan up to an overall sum of Rs 1.3 lakh crore during the financial year 2023-24.

The 16 selected states includes Arunachal Pradesh, Bihar, Chhattisgarh, Goa, Gujarat, Haryana, Himachal Pradesh, Karnataka, Madhya Pradesh, Mizoram, Odisha, Rajasthan, Sikkim, Tamil Nadu, Telangana, and West Bengal, finance ministry statement said Monday.

The maximum amount, of Rs 9,640 crore, has been allocated to Bihar, followed by Rs 7,850 crore to Madhya Pradesh, Rs 7,523 crore to West Bengal, Rs 6,026 crore to Rajasthan and Rs 4,528 crore to Odisha.

According to the official statement, capital investment projects in diverse sectors have been approved including health, education, irrigation, water supply, power, roads, bridges and railways.

Special Assistance to States for Capital Investment has eight parts, the first being the largest with allocation of Rs 1 lakh crore.  This amount will be allocated amongst states in proportion to their share of central taxes and duties as per the award of the 15th Finance Commission. Other parts of the scheme are either linked to reforms or are for sector specific projects.

In the second part of the scheme, an amount of Rs 3,000 crore has been set aside  for providing incentives to states for scrapping of old state government vehicles and ambulances, waiver of liabilities on old vehicles, providing tax concessions to individuals for scrapping of old vehicles and setting up of automated vehicle testing facilities.

The third and fourth parts of the scheme aim at providing incentives to states for reforms in urban planning and urban finance. An amount of Rs 15,000 crore is earmarked for urban planning reforms, while additional Rs 5,000 crore is for incentivising the states for making urban local bodies creditworthy and improving their finances.  (KNN Bureau)