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Informist, Tuesday, Dec. 31, 2024

 

NEW DELHI – With a capital expenditure of INR 5.135 trillion during Apr-Nov, down 12.3%, the government has met only 46.2% of its target for 2024-25 (Apr-Mar) in the first eight months of the fiscal year, according to the data released Monday. In Apr-Nov 2023, the government's capital expenditure had accounted for 58.5% of the Budget estimate and 61.7% of the revised estimate for FY24.

 

The government needs to spend at least INR 1.494 trillion in each of the remaining four months of the year to meet the target of INR 11.111 trillion, as estimated in the FY25 Budget. In November, capital spending rose 21.3% to INR 469.55 billion. 

 

The government's capital expenditure has been sluggish this year as it had a slow start on account of the Model Code of Conduct in April and May because of the Lok Sabha election. There were hindrances to the pace of spending even after the election due to heavy rains that lasted till September. In the last election year of FY20, the government had met 63.3% of its capital expenditure target by November.

 

The pace of capital spending has picked up only after September, Finance Minister Sitharaman had said earlier this month. To ensure capital expenditure, the minister has also been holding meetings with various departments and ministries since September to review spending.  

 

Multiple finance ministry officials, including Economic Affairs Secretary Ajay Seth and Chief Economic Adviser to the government V. Anantha Nageswaran, have mentioned there is a possibility that the government may undershoot the capital spending target for the year. However, the capital expenditure in the current fiscal should be close to the level in FY24, Seth had said in November.

 

In FY24, the government had spent INR 9.485 trillion on capital creation and had met 99.9% of the revised estimate and 94.8% of the Budget estimate for the year. In the Interim Budget for FY25, the government had revised down the FY24 capital expenditure target to INR 9.496 trillion from INR 10.004 trillion.  End  

 

Reported by Krity Ambey 

Edited by Akul Nishant Akhoury

 

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