Jharkhand has rejected the Centre’s proposal to take a loan to make up for its GST revenue shortfall, chief minister Hemant Soren told reporters after a meeting of the state cabinet in Ranchi late on Friday. The Jharkhand cabinet has also decided not to avail itself of loans meant for power distribution companies under the Atmanirbhar Bharat package.

This stand is being seen as a retaliation against the move of the Union power ministry to auto-debit a sum of Rs 1,417.50 crore from the state’s consolidated account — maintained by the RBI — to pay for DVC’s dues. This amount is the first installment of the Rs 5,600 crore Jharkhand owes DVC for power supplied to seven of its districts.

“It’s really unfortunate that the Centre is unable to pay GST compensation to states. To add to our woes, it is asking the RBI to debit money from the state’s consolidated fund,” Soren said. “Such misuse of power was never seen since Jharkhand was formed or even earlier.”

“Coal sector units owe us huge amounts but we never stopped them from carrying coal from the state or never stopped the DVC from using water from our rivers,” Soren said.

“Why should we take a loan when the Centre was supposed to pay us GST compensation,” Jharkhand finance minister Rameshwar Oraon told The Telegraph on Saturday.