Last Update: February 01, 2023, 13:46 IST
The capex-to-GDP ratio was 2.7% during the current financial year and is expected to be 3.3% in the coming financial year. Photo: Reuters)
The money spent by the government on the development of buildings, machinery, equipment, schools and infra is known as capital expenditure. It covers costs incurred by the government for investments that will generate profit, such as land acquisition costs.
Finance Minister Nirmala Sitharaman on Wednesday presented the Union Budget for 2023-24 and raised the capital expenditure (capex) target by 33% to Rs 10 lakh crore, which would be 3.3% of GDP.
Read this also | Budget 2023 Capex spending hiked to Rs 10 trillion: What is capex, how is it beneficial?
The capex-to-GDP ratio was 2.7% during the current financial year and is expected to be 3.3% in the coming financial year.
Read this also | budget 2023 live news update Here
“Capital investment outlay is being raised for the third consecutive year by 33% to Rs 10 lakh crore, which will be 3.3% of GDP. This would be almost three times the outlay in 2019-20,” she said.
Read this also | income tax slab live updates in budget 2023 Here
In the last budget, the finance minister raised capital expenditure by 35.4% to Rs 7.5 lakh crore for the financial year 2022-23. This was done to continue the public investment-led recovery of the economy battered by the pandemic. Last year the capex was pegged at Rs 5.5 lakh crore.
This substantial growth in recent years has been central to the government’s efforts to enhance growth potential, generate employment, attract private investment and provide a cushion against global headwinds, he said.
Sitharaman also said that the effective capital expenditure of the central government is Rs 13.7 lakh crore, 4.5% of GDP.
“The newly established Infrastructure Finance Secretariat will assist all stakeholders for greater private investment in infrastructure, a harmonized master list of infra to be reviewed by an expert committee to recommend classification and financing,” she said.
Read this also | FM’s ‘track record’: Rs 2.40 lakh crore budget has highest ever capital outlay for Railways
The Finance Minister also said that investment in infrastructure and productive capacity has a large multiplier effect on growth and employment. After the pandemic, private investment is on the rise again.
She also announced that the 50-year interest-free loan to state governments would be extended for one more year.
“The 50-year interest-free loan to state governments will be continued for one more year, to boost investment in infra and encourage them for complimentary policy actions with an increased outlay of Rs. 1.3 lakh crore,” she said.
In what he called the “first budget in Amrit Kaal”, the finance minister said 50 additional airports, helipads, water aerodromes and advanced landing grounds would be revived to improve regional air connectivity.
Read this also | Budget 2023 Cheap, Expensive Items: Add Mobile Phones, TVs, Camera Lenses to your shopping cart; Gold, diamonds can be heavy on the pocket
This is the last full budget of the second term of the BJP-led NDA government before the general elections in 2024 after he took charge as finance minister in July 2019.
He said the government has outlined seven priority areas: inclusive growth, reaching the last mile, infrastructure and investment, unlocking potential, green growth, youth power and the financial sector.
read all latest business news Here
