28-September-2020
Economy News
 
Karnataka Cabinet to borrow 33,000 crore to tide over crisis
16-Sep-2020

The Karnataka Cabinet on Tuesday decided to borrow Rs 33,000 crore making use of the window the RBI will soon open for states to tap the debt market to overcome the severe financial crunch the Covid-19 pandemic has thrust upon them. A series of lockdowns and poor business climate has left a gaping hole in the state finances forcing the government to borrow to feed daily governmental expenses. Two weeks ago, the Centre placed two options before the states to compensate for the sharp drop in the GST revenues due to the pandemic. Karnataka opted for the first option under which the Centre will bear the entire principal and interest payments out of the GST cess levied on sin and luxury items.

News Source:- https://economictimes.indiatimes.com/news/economy/finance/karnataka-cabinet-to-borrow-33000-crore-to-tide-over-crisis/articleshow/78140692.cms