The Ministry of Finance released ₹40,000 crore to States and Union Territories with legislatures under the back-to-back loan facility to meet the shortfall in GST compensation arising from insufficient collections in the GST Compensation Cess Fund. With this release, the total assistance provided during FY 2021–22 under this mechanism reached ₹1.15 lakh crore, following an earlier release of ₹75,000 crore in July 2021. The support was extended in accordance with the decision taken at the 43rd GST Council meeting, under which the Centre committed to borrow ₹1.59 lakh crore during the year and pass it on to States as back-to-back loans to bridge the compensation gap, similar to the approach adopted in FY 2020–21. This amount is over and above the regular GST compensation released bi-monthly from actual cess collections and is expected to ensure that total compensation to States in FY 2021–22 exceeds ₹2.59 lakh crore. The funds released were raised through Government of India borrowings in two-year and five-year securities at moderate yields, without requiring additional market borrowing. The release was front-loaded to strengthen the financial position of States, enabling them to manage pandemic-related challenges, enhance health infrastructure, and accelerate capital and development expenditure, with a detailed State-wise distribution provided in the press release.