Centre set to surpass FY25 capex target of Rs 10.18 lakh crore

IANS April 6, 2025 276 views

The Indian government is on track to surpass its capital expenditure target, signaling robust economic momentum. Finance Minister Nirmala Sitharaman emphasized the country's potential to remain the world's fastest-growing economy through strategic infrastructure investments. Government spending is focused on critical sectors like railways and roads, with significant progress already achieved. This approach is expected to drive economic growth and create substantial capital assets across the nation.

"The data received so far indicates that we are likely to exceed the revised target by a significant margin" - Top Government Official
Centre set to surpass FY25 capex target of Rs 10.18 lakh crore
New Delhi, April 6: The government is poised to surpass its revised capital expenditure (capex) target of Rs 10.18 lakh crore for FY25 by a modest margin.

Key Points

1

Centre projects 6.5% economic growth through strategic infrastructure investments

2

Capex allocation reaches Rs 11.21 lakh crore for FY26

3

State-level capital expenditure expected to rebound 18%

4

Railways and road projects show substantial progress

According to an NDTV Profit report on Sunday, citing a top official, “The data received so far indicates that we are likely to exceed the revised target by a significant margin in absolute terms”.

The capex target was lowered to Rs 10.18 lakh crore (revised estimates) in the Union Budget 2025-26, from Rs 11.1 lakh crore.

For current fiscal (FY26), a capex allocation of Rs 11.21 lakh crore has been set by the government.

According to Union Finance Minister Nirmala Sitharaman, the Indian economy will continue to be the world’s fastest-growing economy backed by the increase in the government’s capital expenditure in the Budget for 2025-26 and rising consumption levels, especially in the rural areas.

The effective capital expenditure works out to 4.3 per cent of the GDP in the Budget for 2025-26 while the fiscal deficit is 4.4 per cent.

“This indicates that the government is using the entire borrowed resources for financing effective capital expenditure, creating capital assets,” she pointed out.

The Indian economy is expected to clock 6.5 per cent growth in 2025-26, driven by government investment in big infrastructure projects, and an acceleration in private investment during the year, according to the latest EY Economy Watch report.

A Jefferies report said last month that there has been a significant increase in capital expenditure in India, with growth expected to continue in the coming months as several sectors witnessing strong investments.

The government’s focus on railways and road projects has helped achieve significant progress, with around 83-87 per cent of the financial year 2025 revised estimates already completed for these sectors.

The government's commitment to capital expenditure remains strong, with transfers to states rising by approximately 60 per cent. This financial support is expected to further accelerate infrastructure projects at the state level, boosting overall economic growth.

The capital outlay of the country’s top 15 states for FY26 is projected to rebound by 18 per cent (year-on-year) to Rs 7.2 lakh crore, driven by a post-election boost in capital spending, execution of infrastructure projects and continued allocation of Rs 1.50 lakh crore to states through interest-free capex loans in the Union Budget 2025-26, according to a CareEdge Ratings report.

—IANS

Reader Comments

R
Rajesh K.
This is great news for infrastructure development! More capex means more jobs and better roads/railways. Hope the execution matches the ambition 🙌
P
Priya M.
While I appreciate the increased spending, I hope there's proper oversight to prevent corruption and delays. We've seen too many projects stuck halfway.
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Amit S.
The railway upgrades in my city have been life-changing! If this spending means more such projects, I'm all for it. The new trains are so much better.
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Sunita R.
Good to see rural areas getting attention. Hopefully this translates to better irrigation and storage facilities for our farmers. The backbone of our economy deserves this investment.
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Vikram J.
I'm cautiously optimistic. The numbers look impressive, but I'd like to see more details about where exactly this money is going. Transparency matters!
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Neha P.
The 18% increase in state capital outlay is the real story here! Local infrastructure needs this boost. Maybe my city will finally get that metro extension we've been promised for years 😅

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Tags:
India Economic Growth Capex Target Nirmala Sitharaman Infrastructure Investment Union Budget 2025-26
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