New Delhi: The Centre has released Rs 1,237 crore to Punjab as GST compensation arrears for July 2017-March 2019.

Punjab Finance Minister Manpreet Singh Badal in a letter to Finance Minister Nirmala Sitharaman said the funds came at a “crucial time” when the entire country is facing the Covid-19 crisis.

Stating that the Union Finance Minister has kept her promise of release of funds, Badal said, “In retrospect I feel that the delay has turned out to be a blessing in disguise allowing us to obtain this reserve when it would be most needed.”

The Centre had earlier released Rs 12,857 crore to Punjab on account of compensation for July 2017-March 2019 and with the clearance of arrears, the total amount paid stands at Rs 14,094 crore.

Under the Goods and Services Tax (GST) law, states are guaranteed compensation for revenue loss for five years if their revenues do not increase 14 per cent on the base year of 2015-16. (PTI)