Scheme for Special Assistance to States for Capital Expenditure

The Scheme for Special Assistance to States for Capital Expenditure is currently facing revenue shortfall due to COVID-19 pandemic. The scheme aims to increase the capital expenditure by the state governments. Under the scheme, the Ministry of Finance has so far approved capital expenditure proposals worth Rs 9,878.61 crores. Under the scheme, the capital expenditure projects such as water supply, health, rural development, irrigation, education, transport have been approved. The scheme has three parts that focuses on citizen centric state reforms, north eastern states and other states.

All the states except Tamil Nadu have so far been availed with benefits under the Scheme for Special Assistance to States for Capital Expenditure scheme.

About the scheme

The scheme will boost to capital expenditure of the states. The capital expenditure enhances future productive capacity of the economy and helps to boost economic growth of the country. The scheme was launched under Atma Nirbhar Bharat Abhiyan on October 2020.

Key Features of the Scheme

The scheme has three parts. The North Eastern Region of the scheme covers all the seven north eastern states. Around Rs 200 crores have been allocated to this part of the scheme.

The Part II of the scheme includes all the other states that are not included in Part-I of the scheme. Rs 7,500 crores have been allocated to Part II of scheme.

The Part III of the scheme provides citizen-centric reforms in the states. Around 2,000 cores of rupees have been allocated to this part of the scheme. Under this part of the scheme, amount will be available only to states that carry out three out of four reforms specified by the Ministry of Finance. The four reforms are Power sector reforms, One Nation One Ration Card, Ease of Doing Business reform and Urban Local Body reforms.

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