The Brief: What Next After Capex Front-loading?
Despite the Centre's capital expenditure cycle gaining momentum, gross fixed capital formation — a proxy for investment — lags. It needs attention.
Despite the Centre's capital expenditure cycle gaining momentum, gross fixed capital formation — a proxy for investment — lags. It needs attention.
The Centre has been able to achieve the mega spending on the back of both highways and railways ministry, utilising over 80% of their allocation for the fiscal by Nov itself.
Govt's total expenditure grew by 8.9% during April-August FY23 as compared to 2.3% during the corresponding period of FY22.
Railway and highway ministries have incurred capital expenditure of ₹1,94,768 crore till February, against total allocation of ₹2,38,350 crore for FY22.
A ₹5.54-lakh-crore booster shot for capital expenditure to kick-start the economic cycle has had a mixed effect. Is Centre's capex strategy working?