The Punjab Chief Minister (CM) Amarinder Singh on Friday reiterated his demand for the implementation of the ‘principle of shared responsibilities’ by the Centre to settle the Rs 31,000 Crore Cash Credit Limit (CCL) gap amount that had been converted by the Union government into long term loan.

In separate letters to the Prime Minister (PM) Narendra Modi and Union Minister for Consumer Affairs, Food and Public Distribution Ram Vilas Paswan, the CM said that the CCL gap cannot be solely attributed to the state of Punjab.

The CM urged the PM to intervene in the matter to operationalise the suggested principle of shared responsibilities amongst the Union government, Punjab government and the consortium of banks.

Meanwhile, in separate letters to Paswan, the CM has raised the issue of release of the pending Value Added Tax (VAT) payment, as well as non-reimbursement of actual expenditure on procurement of gunny bags, to the State Procurement Agencies (SPAs).

Amarinder Singh has drawn the minister’s attention to his earlier communication of 26 March, regarding reimbursement of VAT amounting to Rs 952 Crore to the SPAs.

Although the Food Corporation of India (FCI) has admitted that the amount of VAT paid by the SPAs is to be reimbursed, no further progress has yet been reported, he observed, adding that as a result of delay in release of this amount, the SPAs had to borrow to fill the gap for timely authorisation of CCL for the current Rabi Marketing Season.

The letter further said that the FCI and the Ministry of Consumer Affairs, Food and Public Distribution evidently could not release the requisite amount due to non-availability of funds during the previous year. However, the funds are available now and, therefore, reimbursement of VAT paid by the SPAs should be expedited, the CM has requested.

On the issue of the gunny bags, the CM said though the price and payment schedule of the bags, procured as per supply plan approved by the Department of Food and Public Distribution through Jute Commissioner of India, is finalised in accordance with the directions of the Ministry, the actual cost incurred on their procurement, including basic cost, interest, handling and transportation cost, is not reimbursed to the SPAs.

In fact, the cost of gunny bags is paid out of the funds borrowed from banks as short term loan, which is repaid by FCI against delivery of food grains.

Non-reimbursement of actual expenditure on gunny bags results in huge gap in CCL, causing unnecessary burden on state finances, the CM has pointed out.