Capital expenditure outlay hiked to Rs 10 lakh crore in Budget 2023-24

The centre on Wednesday gave a boost to infrastructure development and earmarked Rs 10 lakh crore as capital expenditure for financial year 2023-24. This is significantly higher than the Rs 7.5 lakh crore allocated in the fiscal 2022-23 of which around 60% has been spent till December-end.

“Capital investment outlay is being increased steeply by 33% to Rs 10 lakh crore. This will be 3.3% of GDP. Will be almost three times the outlay made in 2019,” Finance Minister Nirmala Sitharaman said in her Budget speech 2023-24.

She also said that the allocation for 50-year interest free loans to state governments for infrastructure development hiked to Rs 1.3 lakh crore, up from Rs 1 lakh crore in last budget.

In addition to these, Sitharaman said that 100 critical transport infrastructure projects for last and first mile connectivity to ports, coal, steel, and fertiliser and food grain sectors have been identified. “They will be taken up on priority at an investment of Rs 75,000 crore. This includes Rs 15,000 crore from private sources,” she said.

Sitharaman said that the allocation for the Pradhan Mantri Awas Yojana, targeted towards building affordable houses, is being enhanced by 66% to over Rs 79,000 crore. In addition to this, coastal shipping will be promoted through Viability Gap Funding. Support also will be provided to state and central government departments to replace old polluting vehicles.

Commenting on the budget announcement, Ajay Sawhney, Partner at Cyril Amarchand Mangaldas said, “The new capital outlay was much needed to accelerate economic growth as the infrastructure sector is an engine having multiplier effect across the entire ecosystem including employment.”