Capital expenditure hiked 34.5% to ₹5.54 lakh cr in FY'22 to push growth

Budget 2021: The government's planned capital expenditure for the current fiscal has been increased to ₹4.39 lakh crore, as against the Budgeted ₹4.12 lakh crore.

To push growth via infrastructure creation, Finance Minister Nirmala Sitharaman on Monday hiked the government's capital expenditure for FY 2021-22 by 34.5 per cent to ₹5.5 lakh crore.

(Representative image) The government has decided to monitor the utilisation and management of capital expenditure by PSUs on a monthly basis.

The government's planned capital expenditure for the current fiscal has been increased to ₹4.39 lakh crore, as against the Budgeted ₹4.12 lakh crore.

"Sharp increase in capital budget in BE 2020-21. We have provided for ₹4.12 lakh crore for (capital) expenditure. It was our effort that in spite of resource crunch we should spend more on capital expenditure and we are likely to end this year at around ₹4.39 lakh crore which we have provided in RE (revised estimate) of 2020-21," Sitharaman said in her 2021-22 Budget speech.

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For the next fiscal, the minister proposed sharp increase in capital expenditure and provided ₹5.54 lakh crore.

This is 34.5 per cent higher than Budget estimate of ₹4.12 lakh crore in 2020-21.

"Of this I have kept a sum of more than ₹44,000 crore in the Budget head of Department of Economic Affairs to be provided for projects, programmes or the departments that show good progress in capital expenditure and are in need of further funds," she said.

Over and above this expenditure, the government would also be providing more than ₹2 lakh crore to states and autonomous bodies for their capital expenditure.

"We will also work out specific mechanism to nudge states to spend more of their Budget on creation of infrastructure," Sitharaman said.