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Informist, Tuesday, Dec. 17, 2024

 

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--Lok Sabha passes first batch of supplementary demands for grants for FY25 
--Sitharaman: Pace of govt expenditure not slow after Jul-Sept 
--Sitharaman: Domestic LPG coverage has reached near saturation 
--CONTEXT: Sitharaman in Lok Sabha in supplementary demands for grants debate 
--Sitharaman: Low Jul-Sept GDP growth temporary blip, expect econ to recover 
 

 

NEW DELHI – The pace of government expenditure, which slowed down in the first half of 2024-25 (Apr-Mar) due to the Lok Sabha elections, has picked up after the September quarter, Finance Minister Nirmala Sitharaman said Tuesday. Some of the Budget announcements were implemented in August after Parliament passed the full Budget for FY25, which delayed the expenditure, the minister said.

 

The slowdown in government expenditure, especially capital spending, had a bearing on GDP growth in Jul-Sept. India's GDP growth slowed down to a seven-quarter low of 5.4%. Sitharaman said the slowdown was a temporary blip. "I am very optimistic about the performance going forward."

 

The government expenditure in Apr-Sept was 43.8% of the Budget target for the whole year compared with 47.1% in the same period last year. The capital expenditure in the first half of FY25 was only 37.3% of the full year's target compared with 49.0% in the same period last year.

 

To support economic growth, the ministry has prioritised capital expenditure over revenue expenditure and will continue to do so, Sitharaman said.

 

"For every rupee spent on the capital account, the multiplier effect touches even 3.48, sometimes even 4.83. That is the kind of multiplier effect you get when you spend on the capital account. Whereas if spent on the revenue account, for every one rupee, you get only 0.98," Sitharaman said, replying to a discussion on the first batch of Supplementary Demands for Grants for FY25 in the Lok Sabha.

 

The Lok Sabha later passed the first batch of Supplementary Demands for Grants, through which the government has sought Parliament's approval for a net additional spending of INR 441.43 billion. This batch of Supplementary Demands for Grants is far less than what the government had sought last year, Sitharaman said. In FY24, the government had sought Parliament's approval to spend INR 584 billion in the first batch.

 

Speaking on prices, Sitharaman said the government is committed to managing inflation. Sitharaman cited the prices of liquefied petroleum gas cylinders in India, which she claimed are lower compared to the neighbouring nations. With 326 million households getting LPG connections, the domestic LPG coverage has reached "near saturation", Sitharaman said.

 

The 326 million households include 103.3 million households, which received LPG connection under the Pradhan Mantri Ujjwala Yojana, the minister said. Under the scheme, the government provides a subsidy of 300 rupees per 14.2 kg cylinder to eligible beneficiaries for up to 12 refills in a year.  End  

 

Reported by Krity Ambey

Edited by Saji George Titus

 

 

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