The Central government on Friday released ₹6,195.08 crore to 14 states as the sixth equated monthly installment of the Post Devolution Revenue Deficit Grant (PDRDG) as recommended by the 15th Finance Commission.
The 14 states that received funds are Andhra Pradesh, Assam, Himachal Pradesh, Kerala, Manipur, Meghalaya, Mizoram, Nagaland, Punjab, Sikkim, Tamil Nadu, Tripura, Uttarakhand and West Bengal.
“The government on September 10, 2020, released ₹6,195.08 crore to 14 states as the sixth equated monthly installment of the Post Devolution Revenue Deficit Grant as recommended by the 15th Finance Commission. This would provide them additional resources during the corona crisis,” Sitharaman’s office tweeted.
The Ministry had released similar amount on April 3 and May 11 as the first and second installments of the post devolution revenue deficit grant to 14 states.
What is the post devolution revenue deficit grant? About a third of the total revenue collected by the Centre is directly transferred to states as their share in the divisible pool. However, the Finance Commission also provides a mechanism for compensation of any loss incurred by states, which is called post-devolution revenue deficit grants. This Finance Commission Grant forms the second largest chunk of Finance Commission transfers after the assistance to local rural bodies.
