Centre advances devolution as states hunt for funds, transfers Rs 1.16 trn

Money will help carry out their capital expenditure and welfare spending plans

The Centre on Wednesday released Rs 1.16 trillion in devolution to states, instead of the usual monthly practice of Rs 58,333 crore.

It is a clear indication that owing to healthy direct tax and goods and service tax collections, the Centre is frontloading devolution to states from the divisible tax pool. The step will help carry out their capital expenditure and welfare spending plans.

Two installments of devolution were paid in November 2021 as well, after Finance Minister Nirmala Sitharaman met with her state counterparts and chief ministers on economic and infrastructure issues.

By norm, money from the divisible tax