More capex for states

Higher Central funds for states' capital outlay are welcome, but these should lead to additionality

capex, states capex, capital expenditure

A K Bhattacharya
A key feature of Finance Minister Nirmala Sitharaman’s Budgets has been the steady rise in the government’s capital expenditure. From about 1.67 per cent in 2019-20, the share of the government’s capital expenditure in gross domestic product, or GDP, rose steadily in the following years — to 2.15 per cent of GDP in 2020-21, 2.53 per cent in 2021-22, and to 2.67 per cent in 2022-23. In the current financial year, it is budgeted to rise to 3.3 per cent of GDP. The last time the government’s capital expenditure had crossed the level of 3 per cent of GDP was almost two decades ago in 2004-05.

This was creditable, not least because a smaller increase in the government’s capital expenditure could
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of or the Business Standard newspaper

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First Published: Jul 25 2023 | 9:33 PM IST

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