Govt sets aside 29% of budgetary spending for capital expenditure

The share of capital expenditure this year is an improvement from 2021-22, when it was 25%.

The state government will spend ₹75,800 crore in the 2022-23 fiscal, finance minister Manish Sisodia said while presenting his eighth budget in the Delhi assembly on March 26. Of this amount, 29% will be dedicated for capital expenditure (activities that create productive assets for the future).

Delhi deputy chief minister Manish sisodia presents the budget.  (AAP Twitter)

The share of capital expenditure this year is an improvement from 2021-22, when it was 25%.

Of the budgeted spending, 62.9% will be raised through the state’s own tax revenues.

“During the current financial year up to February 2022, we have collected ₹35,112 crore (in taxes), with an increase of 39% over the previous year (up to February 2021)”, Sisodia said in his speech, suggesting that Delhi’s revenue situation has recovered from the disruption caused by the pandemic.

“The budget of ₹75,800 crore during the year 2022-23 is proposed to be mainly financed from [Delhi’s] own resources. The major components are ₹47,700 crore from own tax revenue, ₹1,000 crore from non-tax revenue, ₹325 crore as share in Central taxes, ₹10,000 crore from small saving loans, capital receipts of ₹802 crore, GST compensation of ₹ 10,000 crore, ₹1,621 crore from centrally sponsored scheme, ₹643 crore as grant-in-aid/normal assistance from the Central government,” Sisodia said in his speech.

Delhi’s real GSDP [gross state domestic product] growth is expected to be 10.23% in 2021-22, the Economic Survey Sisodia presented on March 25 had said. This means that Delhi’s GSDP will be 6% above pre-pandemic levels (2019-20).

The Budget Speech and Budget Highlights documents, which were the only documents available till 12pm, did not give a fiscal deficit number or ratio for the state for 2021-22 or 2022-23.

While the total budgeted spending for 2022-23 is significantly higher than the 2021-22 Budget Estimates (BE) of ₹69,000 crore, revised estimates (RE) show that in 2021-22, the government ended up spending ₹2,000 crore less than the BE value.

“The contribution of Delhi’s real GSDP to GDP at the national level has increased from 3.94% in 2011-12 to 4.21% in 2021-22, whereas Delhi is only 1.52% of the total population of the country”, Sisodia said in his speech.

Sisodia said the service sector is the primary contributor to Delhi’s economy and its contribution to the Gross State Value Added at current market prices is 83.94%. The contribution of the secondary sector is 13.78% and the primary sector is 2.28%.

“The most important step to take to increase the income of Delhi residents to one that is at par with Singaporeans by 2047, is to ensure more citizens have respectable employment. Therefore, as a first step to fulfil the envisioned dream for 2047, I have brought the Rozgar Budget before this House,” Sisodia said in his speech.

Debolina Kundu, professor at the National Institute of Urban Affairs, said, “The 22% expenditure on education is a welcome approach. However, given the pandemic situation, a higher health and social expenditure outlay would have been appreciated. Various new development initiatives such as the Business Blasters scheme in schools, the start-up policy, schemes promoting green jobs, smart urban farming, and the food truck policy will improve the overall socio-economic health of the NCT. Rozgar Bazar 2.0 is an important move to provide 100,000 jobs every year to young people in Delhi, especially women.”