State can now borrow addl Rs 90 cr from open market

From Our Special Correspondent
New Delhi, March 20: Cash strapped Meghalaya, which has completed the process of Centre’s Ease of doing Business recently, will now be able to borrow additional Rs 96 crore from the open market, sources said.
The Union finance ministry said as many as 20 states, including Meghalaya, have completed the Ease of Doing Business reforms stipulated by the department of expenditure which will enable them to get additional borrowing through open market.
The states which have implemented the ease of doing business reforms get additional borrowing permission of Rs 39,521 crore through open market borrowings.
“States completing Ease of Doing Business reforms are eligible for additional borrowing of 0.25 per cent of Gross State Domestic Product (GSDP),” the ministry said.Accordingly, on receipt of recommendations from the Department for Promotion of Industry and Internal Trade (DPIIT), the department of expenditure has granted permission to these 20 States to raise additional financial resources of Rs 39,521 crore through open market borrowings.
“The ease of doing business is an important indicator of the investment-friendly business climate in the country,” a statement from Union ministry of finance said.
The Centre had, in May 2020, decided to link the grant of additional borrowing permissions to states, who undertake the reforms to facilitate ease of doing business, it added.
Cash strapped states such as Meghalaya despite joining this scheme late can borrow from open market to meet their deficit.