Finance Nirmala Sitharaman is likely to allocate an amount of ₹9.5 lakh crore to ₹10 lakh crore towards capital expenditure in the upcoming budget. FY23 allocation to sectors like highway and railways is also likely to be raised in the revised estimates for the current financial year.
A source close to the development told Fortune India on condition of anonymity, "Budget is likely to continue the thrust on capital expansion in the economy with the global uncertainties. The allocation towards capital asset formation is likely to be in the range of ₹9.5 lakh crore to ₹10 lakh crore."
At ₹10 lakh crore, the capital allocation will be almost 33% more than the FY23 capital outlay of ₹7.5 lakh crore as the economy is witnessing a healthy absorption of the budgetary capital.
In April-November FY23, capital expenditure utilisation by the central ministries has gone up by 63% to ₹4,47,113 crore, compared with ₹2,73,630 crore spent on capital assets in the same period of the previous fiscal year. Almost 60% of funds have been utilised till the month of November. This massive utilisation is on the back of both ministry of highways and railways ministry utilising over 80% of their allocation for the fiscal by November itself.
Out of the FY23 allocation of ₹1,87,744 crore, the highway ministry has utilised a total of ₹1,49,364 crore till the month of November in the current financial year. Utilisation as a percentage of the budget estimate has gone up to 80% till November this year compared with 68% till the same period in the previous financial year.
Similarly the ministry of railways too has utilized 84% of the budgetary allocation ₹1,15,098 crore till November. The ministry was allocated capital outlay of ₹1,37,100 crore. Sources point out that allocation for both the ministries is likely to be revised upwards in the revised estimates for the current financial year.