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Informist, Thursday, May 29, 2025

 

--Sitharaman: Some states using Centre's money for capex, not own resources 
--CONTEXT: Finance Minister Sitharaman speaking at an event in New Delhi 
--Sitharaman: Cross border transcations will be more efficient with CBDC

 

NEW DELHI – Finance Minister Nirmala Sitharaman Thursday said cross-border transcations are more efficient with Central Bank Digital Currency. While interacting with students at an event in Delhi, Sitharaman said, "The Reserve Bank of India's attempt at both the retail and the wholesale will go on in the e-rupee mode, but there is also lot of technology driven payments and financial transactions happening."

 

The circulation of e-rupee jumped 334% in 2024-25 (Apr-Mar), driven entirely by the retail segment, data from the Reserve Bank of India's Annual Report for FY25 showed. Retail e-rupee worth INR 10.17 billion was in circulation at the end of March, four times higher than INR 2.34 billion a year ago. Of the INR 10.17 billion in circulation, INR 8.58 billion was in the denomination of INR 500.

 

"Global currencies interoperability of systems and initiating into digital payments are all simultaneously happening. In India, the extent to which common people have taken to it has amazed the world," Sitharaman said. She also said that perhaps in a year "we will be in a better position to speak about each one in a concrete fashion."

 

Responding to a query by a student on spending by state governments, Sitharaman said both states as well as Centre are spending on capital expenditure and social sector. "Everybody spends on social at least post COVID, everybody is made to spend on capital also," she said. 

 

Highlighting the scheme for special assistance to states to carry out capital expenditure, Sitharaman said, "Capital expenditure all states are now understanding the importance of it with the money given by the Centre and their own resources. But many states are not doing their own money, the Centre's money which comes they go along with it because it is coming. Some of them are reducing capital expenditure with their own resources." 

 

First launched in the Budget for FY22, the scheme for special assistance to states to carry out capital investment is in line with the Narendra Modi government's thrust on capital expenditure to drive economic growth. In the last five years, the government has increased capital expenditure by more than three times. In FY25, the government ended up releasing just short of INR 1.50 trillion to states for capex loans, much higher than the revised estimate of INR 1.25 trillion and close to the original target set by the government.  End

 

Reported by Sagar Sen

Edited by Akul Nishant Akhoury

 

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