Finance Minister Nirmala Sitharaman said on 15th November 2021 that the centre will release additional devolution funds due to states on 22nd November 2021 to enable them to spend on capital expenditure, as the centre and states look to boost economic activity.
Finance Minister said after a day-long interaction with chief ministers and administrators of states on economic and infrastructure-related issues. Many states suggested that it would be helpful for them to get a part of the tax devolution frontloaded. This being an exceptional year, states will not be short of money when all of us are pushing for infrastructure. On 22nd November 2021, two devolution installments of Rs 47,541 Crore will be released to states. That totals to Rs 95,082 Crore.
The finance minister further added that the chief ministers from 15 states attended the interactions, and the finance ministers and other ministers represented the remaining states. As per the recommendations of the 15th Finance Commission, 41% of the divisible tax pool is to be devolved to states. Finance Secretary TV Somanathan said that the funds are given to states in 14 installments, 11 in eleven months and 3 in March, the last month of the fiscal year.