The government proposes to increase capital expenditure outlay by 11.1 per cent to Rs 11.11 lakh crore in 2024-25, Union Finance Minister Nirmala Sitharaman said on Thursday in her interim Budget, ahead of the General elections.
A capital expenditure, or capex, is used to set up long-term physical or fixed assets.
Last year, which was the last full Budget under the Prime Minister Narendra Modi-led government’s second term, the government proposed to increase capital expenditure outlay by 33 per cent to Rs 10 lakh crore in 2023-24, which was estimated to be 3.3 per cent of the GDP.
With the substantial increase in capex, it is central to the government’s efforts to enhance growth potential and job creation, crowd in private investments and provide a cushion against global headwinds.
The Indian economy under Prime Minister Narendra Modi has witnessed a profound transformation in the last 10 years when the government took several pro-people reforms that were structural, said the Finance Minister Nirmala Sitharaman in her initial remarks.
“In 2014, the country was facing enormous challenges, the government overcame those challenges and undertook structural reforms, pro-people reforms were undertaken, conditions for jobs and entrepreneurship were set in, fruits of development started reaching people at scale, country got a sense of new purpose and hope,” Sitharaman said.
“In second term, the government strengthened its mantra and our development philosophy covered all elements of inclusivity, namely social and geographical With a whole of nation approach, the country overcame challenges of the COVID-19 pandemic, took long strides towards Aatma Nirbhar Bharat and laid solid foundations for Amrit Kaal.”
She said her government is working towards development which is all round, all inclusive and all pervasive, covering all castes and people at all levels We are working towards making India a Viksit Bharat by 2047.
The interim budget will take care of the financial needs of the intervening period until a government is formed after the Lok Sabha polls after which a full budget will be presented by the new government in July.
With this Budget Presentation Sitharaman will equal the record set by former Prime Minister Morarji Desai, who as finance minister, presented five annual budgets and one interim budget between 1959 and 1964.
The Budget Session of Parliament commenced on Wednesday with President Droupadi Murmu addressing a joint sitting of Lok Sabha and Rajya Sabha.
In her address to Parliament, the President said the year 2023 was a historic year for the country and among other steps, the country kept up the momentum of being the fastest-growing major economy.
“The year 2023 was a historic year for India when it grew the fastest among major economies despite the global crisis. India grew about 7.5 per cent for two consecutive quarters,” she said.
The Indian economy is projected to grow close to 7 per cent in the financial year 2024-25 which starts this April, said the Ministry of Finance in a review report.
India’s economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22. The Indian economy is expected to grow 7.3 per cent in the current financial year 2023-24, remaining the fastest-growing major economy.
The last full Budget of Modi government 2.0 had proposed to increase capital expenditure outlay by 33 per cent to Rs 10 lakh crore in 2023-24, which would be 3.3 per cent of the GDP. It was almost three times the outlay in 2019-20.
