New Delhi [India], December 17 (ANI): Union Finance Minister Nirmala Sitharaman on Tuesday stated that the effective capital expenditure of the Union government for this fiscal year is pegged at a staggering Rs 15.02 lakh crore, among the highest such spending by the central government.
“Effective Capital Expenditure, inclusive of our capital assistance to the states interest-free…it is pegged at the Rs 15.02 lakh crores, one of the highest in the Government of India’s history,” she said.
Replying to the debate in Lok Sabha on the supplementary demands for grants for 2024-25, Sitharaman noted that capital expenditure is critical for sustaining economic growth and that it plays a key role in creating multiplier effects throughout the economy. The supplementary demands for grants (first batch) for 2024-2025 were approved by the Lok Sabha.
“The expenditure on capital accounts generates a multiplier effect that can reach up to 4.3, which is much higher compared to spending on revenue accounts, where the effect is only 0.98,” the Union Minster said.
Sitharaman said that the government is seeking the authorisation of the Parliament for the gross additional expenditure of Rs 87,700.62 crore.
“The net cash outgo or cash supplementaries is Rs 44,100.87 crore. The technical token supplementary is also mentioned. Expenditure on capital account is something which I would like to take a minute to say that it is about Rs 19,400.16 crore. The balance of Rs 68,346.21 crore in the supplementary demand for grant is on the revenue account,” she said.
The Union Minister expressed optimism on economic growth, saying that the sluggish figures of second quarter GDP growth was a “temporary blip.”
She said the country’s GDP growth averaged 8.3 per cent over the last three years which demonstrates resilience despite global uncertainties. She added that the second quarter has been a challenging time not just to India but to the countries around the globe.
“Out of the 12 quarters in the past three years, the GDP growth rate was lower than 5.4 per cent in two quarters, quarter four of 2021-22 and quarter three of 2022-23. So it is important to understand that this drop happened in just two quarters in last 12 quarters that we are talking about. So let us not pick one and predict the future,” the Union Minister stated.
“This has been the study growth and sustained growth,” she said, adding that the steady growth reinforces India’s position as the fastest-growing major economy in the world.
She refuted the claims of slowdown in the manufacturing sector.
Referring to the concerns of members about price rise, she compared the level of inflation in the Congress-led UPA and Modi governments.
She said inflation is better controlled in the NDA government and stated that the retail inflation averaged 4.8 per cent between April and October 2024-25, the lowest recorded since the COVID-19 pandemic.
She noted that inflation was in double digits during the UPA government.
Sitharaman also highlighted the government’s commitment towards affordable energy.
The minister said that all-India annual unemployment rate has been declining since 2017-18 and according to data from the Periodic Labour for Survey report (PLFS) report, the unemployment rate dropped from 6 per cent in 2017-18 to 3.2 per cent in 2023-24.
Sitharaman said capital expenditure supports long-term growth by building infrastructure, creating jobs, and contributing to the economy’s overall development. The focus of the expenditure is on critical areas such as regional connectivity, highways, railways, coastal and shipping infrastructure, digital connectivity, and multimodal logistics.
She emphasised the government’s commitment to addressing the skill deficit through a package of five schemes. These schemes are designed to upskill the workforce, making them ready for the jobs created through ongoing and upcoming infrastructure projects.
The Union Minister expressed confidence that the large-scale investment in capital expenditure will not only boost economic growth but also give states a significant role in building their own capital expenditure accounts, contributing to a more robust economy in the long term. (ANI)
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