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New Delhi: Finance Minister Nirmala Sitharaman maintained the FY25 capital expenditure (capex) outlay for India at Rs 11.11 lakh crore in the first Union Budget of the third Narendra Modi administration, consistent with the allocation made in February. This figure surpasses the revised estimate of Rs 9.5 lakh crore from the previous year.
The government’s budgetary capex spending will reach 3.4 per cent, a slight increase from 3.2 per cent last year, and nearly double the expenditure from five years prior.
Capex growth has remained in the double digits for six of the past seven years but is expected to decelerate from the 28.4 per cent growth seen in FY24 and 24.8 per cent the year before that.
Roads and railways continue to receive the largest portion of capex, with their share rising from just over 35 per cent a decade ago to nearly 50 per cent in FY24.
Last year’s advance loan disbursements by the central government contributed to a 30 per cent increase in state capex for FY24.
The government’s capital spending was at 12.9 per cent of its target, lower than the 16.8 per cent achieved in the preceding year.
So far, in the first two months of the fiscal year, the government has expended up to Rs 1.43 lakh crore.
Loan disbursements have accelerated beyond the previous year’s rate, with the state distributing Rs 22,702 crore.
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