Unfazed by disruptions caused by the Ukraine war on the economy, the Government of India is going ahead all guns blazing on the capital expenditure front, data reveals. In the first month of the current financial year (April), Centre has deployed capital expenditure to the tune of ₹78,925 crore, up 67% from ₹47,126 crore in April, 2021.
The money spent in April is 10.5% of the annual capital expenditure target of ₹7,49,652 crore in 2022-23 and reveals the Centre’s intent to not only go ahead with the budgeted expenditure despite the global headwinds, but also front-load it in an attempt to stoke growth in the economy.
In fact, in the wake of the economic disruptions caused by the Russia-Ukraine crisis, finance ministry maintains that the budgeted expenditure on capital account will not be curtailed. One of the defining features of the current year’s budget was a huge allocation towards the public infrastructure spending in order to instill confidence in the economy and keeping the investment cycle alive in the backdrop of a muted response from the other engines like private investment and consumption. The allocation therefore, was enhanced to ₹7.5 lakh crore, up 35% from ₹5,54,108 crore allocated in FY22.
As far as the individual ministries are concerned, the highway and railways ministries, which account for a lion’s share in the ₹7.5 crore capital expenditure plan are pushing the pedal. At ₹40,318 crore in April, the Ministry of Road Transport and Highways has spent 21% of its FY23 allocation of ₹1,87,744. It may be noted that in April last year, highway ministry had spent ₹22,496 on the capital account.
Also the Ministry of Railways has spent an amount of ₹18,200 crore in the month, which is 13% of the annual allocation of ₹1,37,100 in FY23. Also the amount spent is up from ₹13,000 crore capex done by the ministry in April last year.