Govt seeks Parliament’s nod for extra spending of Rs 23,675 crore on Covid relief, GST loans

File photo of Union Finance Minister Nirmala Sitharaman | PTI

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New Delhi: Finance Minister Nirmala Sitharaman on Tuesday sought Parliament nod to spend a net additional Rs 23,675 crore, including Rs 17,000 crore for the health ministry, in the current financial year.

As per the first batch of supplementary demands for grants tabled in the Lok Sabha by Sitharaman, although the gross additional expenditure is over Rs 1.87 lakh crore in 2021-22, the actual cash outgo will only be Rs 23,674.81 crore as the remaining spending will be met through savings and higher receipts and recoveries.

A substantial chunk of the total gross spending is towards transfer to states for shortfall in goods and services tax compensation cess. Rs 1.59 lakh crore would be transferred to states as back-to-back loan in lieu of the GST compensation shortfall. However, this will not entail any cash outgo.

“As the back-to-back loan are to be met from equivalent capital receipts, the … expenditure will not entail any additional cash outgo,” the supplementary demands for grants said.

To meet the various COVID-related and other health preparedness, Rs 16,463 crore extra spending has been earmarked for the department of health and family welfare. An extra Rs 526 crore has been given to the department of health research for emergency epidemic preparedness and response.

Approval for Rs 2,050 crore for Ministry of Civil Aviation is being sought, which includes Rs 1,872 crore towards loans and advances to Air India for recoupment of advance from Contingency Fund of India.

The cash outgo also includes Rs 1,100 crore for Ministry of Consumer Affairs, Food and Public Distribution towards providing assistance to sugar mills for 2019-20 sugar season.

Besides, nod for spending an additional Rs 1,222 crore under the head Department of Pharmaceuticals has been sought towards waiver of the government loan of Indian Drugs and Pharmaceuticals Ltd (Rs 889.50 crore) and waiver of government loan (Rs 107.49 crore) and accrued interest (Rs 86.22 crore) of Bengal Chemicals & Pharmaceuticals Ltd.

The excess spending grant for pharma department also includes additional expenditure to clear pending employee dues of Hindustan Antibiotics Ltd (Rs 118 crore) and Rajasthan Drugs and Pharmaceuticals Ltd (Rs 21 crore) as loan.

The additional spending is over and above the total expenditure of Rs 34.83 lakh crore projected in the Budget for 2021-22.

Also read: Strong fundamentals, market size will attract foreign investments, says Nirmala Sitharaman


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