Capex hike to social sector cuts: The story of Budget 2022, in nine charts
2 years, 10 months ago

Capex hike to social sector cuts: The story of Budget 2022, in nine charts

Live Mint  

An aggressive focus on government spending led on the capital side was the big theme of Finance Minister Nirmala Sitharaman's second pandemic budget. We explore Budget 2022 in nine charts: Dissecting the capex For an economy emerging out of a pandemic, Finance Minister Nirmala Sitharaman was expected to ramp up the capital expenditure markedly. Welfare cuts Unlike last year, Sitharaman made no major announcement for the health sector during her second Budget speech of the pandemic. The debt question The sharp capex increase and modest GDP and tax revenue projections will increase the Centre’s debt to 59% of GDP in 2022-23, despite the fiscal deficit being pegged 50 basis points lower. Special loans to boost capex and relaxation in states’ fiscal deficit limits may help, but the flat tax transfer share does little to relieve the fiscal federalism tensions.

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History of this topic

Industry needs to up R&D spend, expect govt capex growth to sustain: Ficci
1 week, 3 days ago

Industry needs to up R&D spend, expect govt capex growth to sustain: Ficci

Live Mint  

New Delhi: Businesses need to step up their research and development spending, and the industry expects the government to sustain the growth in budget allocation for capital expenditure as these two would help the Indian industry to become more competitive in global markets, Harsha Vardhan Agarwal, president of Federation of Indian Chambers of Commerce and Industry, and vice-chairman and managing …

Capex support will continue for infrastructure development: Minister Chaudhary
1 week, 4 days ago

Capex support will continue for infrastructure development: Minister Chaudhary

Live Mint  

India's capital expenditure on infrastructure projects such as roads, railways, ports, airports, and telecommunications has been rising steadily over the years, and the government stands ready to make adequate funds available in next year's budget as well to maintain the sector's growth momentum, minister of state for finance Pankaj Chaudhary said on Friday. India aims to become a developed nation …

‘Centre, state CPSE capex could decline in FY25’
2 weeks ago

‘Centre, state CPSE capex could decline in FY25’

Live Mint  

New Delhi: Capital expenditure by central infrastructure ministries, central public sector enterprises and state governments is expected to slow in FY25 after rising to a five-year high of 5.87% of GDP in FY24 due to reduced spending in the first two quarters, two people familiar with the matter said. "The Centre will continue its capital expenditure push in the upcoming …

Centre likely to miss ₹1.5 trillion capex loan target for states in FY25
2 weeks, 6 days ago

Centre likely to miss ₹1.5 trillion capex loan target for states in FY25

Live Mint  

The Centre is likely to fall short of fully utilizing the budgeted allocation for states under the ‘Special Assistance for Capital Investment’ scheme in 2024-25, as state spending took a hit during the general elections and a slowdown in economic growth, particularly in the first two quarters, two people aware of the matter told Mint. "While the capital expenditure at …

Capex slowdown helps govt cut deficit by 6.6 per cent in Apr-Oct
3 weeks, 3 days ago

Capex slowdown helps govt cut deficit by 6.6 per cent in Apr-Oct

New Indian Express  

NEW DELHI: The slowing down of capital expenditure has helped the central government keep its books in order with fiscal deficit contracting by 6.6% in the first seven months of the current financial year, according to the data released by the government. The fiscal deficit during the period was Rs 7.5 lakh crore, which is 46.5% of the budget target …

Govt plans survey of lagging private capex
2 months, 4 weeks ago

Govt plans survey of lagging private capex

Hindustan Times  

The statistics ministry is planning to conduct a survey of private-sector capital investment going into the economy, which has been lagging government capex but is critical for growth and jobs in Asia’s third-largest economy, a senior official has said. Private sector investment has grown at a slower pace, outstripped by government fixed capital formation, a measure of public spending on …

Modi government's Capex ambitions face budgetary constraints amid political pressures
5 months, 1 week ago

Modi government's Capex ambitions face budgetary constraints amid political pressures

New Indian Express  

NEW DELHI: The Narendra Modi-led government, since it took reins in 2014, has boasted of creating infrastructure at an unprecedented pace. In the first 10 years of his government’s tenure, the government has increased allocation to capital expenditure – spendings on creating infrastructure and other productive assets – by over five times. As Finance Minister Nirmala Sithraman readies herself to …

Budget 2024: Capital gains tax reform, stimulus for private capex push; what mutual fund players want from FM Sitharaman
5 months, 1 week ago

Budget 2024: Capital gains tax reform, stimulus for private capex push; what mutual fund players want from FM Sitharaman

Live Mint  

Union Finance Minister Nirmala Sitharaman will present the Budget 2024 on July 23. One mutual fund expert argues that the government should consider eliminating the capital gains tax an investor pays when he moves his investment from a regular to a direct scheme. Investors demand that this new tax be reversed or at least that indexation benefit be restored for …

New private investments dropped over 15% in 2023-24; States led capex growth
8 months ago

New private investments dropped over 15% in 2023-24; States led capex growth

The Hindu  

Fresh investment plans by the private sector fell 15.3% in 2023-24, while foreign investors slashed new outlays by almost a third, dragging down the value of new investment announcements in the country almost 5% from the all-time high of almost ₹37 lakh crore recorded in 2022-23. Manufacturing’s share in new investments, declined from almost 54% in 2022-23 to 33.8% of …

Lacklustre capex by PSUs is blunting government’s growth stimulus
10 months, 2 weeks ago

Lacklustre capex by PSUs is blunting government’s growth stimulus

Live Mint  

The Narendra Modi government’s strategy for supporting growth has been to increase capital expenditure through its budget in the hope that the infrastructure created would nudge the non-government sector to invest, creating new incomes. FY25 will be the fourth successive year in which more than half the growth in the total spending through the budget will be due to higher …

The budget does well on both the big Cs: Capex and consolidation
10 months, 2 weeks ago

The budget does well on both the big Cs: Capex and consolidation

Live Mint  

Emphasis on the two big Cs—Capex and Consolidation—was the hallmark of India’s interim budget for 2024-25. The government’s concerted focus on capex-led growth has kept the economy in good stead, aiding its emergence as the fastest-growing major economy in the world for three consecutive years by logging 7%-plus real gross domestic product growth. The budget ticked all the boxes on …

Interim Budget surprises fixed income market
10 months, 3 weeks ago

Interim Budget surprises fixed income market

New Indian Express  

It was expected to be a restricted vote on national accounts, but this interim budget, instead, surprised fixed income markets so much so that the yield of India’s benchmark 10-year government security fell by 9 bps. Firstly, in FY24, not only did India manage to achieve the highest economic growth on the back of heavy public capex, but it did …

A case of capex under the ‘macroscope’
10 months, 3 weeks ago

A case of capex under the ‘macroscope’

The Hindu  

India’s economic recovery in the early post COVID-19 pandemic phase was distinctly underscored by a strong performance in exports and domestic investments. The FY25 Interim Budget carries forward the ethos of public capex a notch higher, thereby bolstering the government’s commitment to high quality spending. The budgeted capex by the central government, an important metric for capacity creation in the …

Interim budget 2024-25: Capex raised to 3.4% of GDP despite fiscal consolidation
10 months, 3 weeks ago

Interim budget 2024-25: Capex raised to 3.4% of GDP despite fiscal consolidation

Hindustan Times  

The central government’s capital spending in 2024-25, according to the interim budget will be ₹11,11,111 crore, a number which is more like an auspicious figure than a hard-headed budgetary allocation. Read here: Interim budget 2024-25: Govt stays the course on fiscal consolidation path Fiscal numbers of the second Narendra Modi government speak for themselves. The share of capital spending in …

Interim Budget 2024: Overall spending likely to see 10% hike, says report
11 months, 1 week ago

Interim Budget 2024: Overall spending likely to see 10% hike, says report

India Today  

The upcoming interim budget for the fiscal year 2024-25 may witness a cautious approach from the government, with an anticipated 10 per cent increase in overall spending compared to the current fiscal year, reported The Economic Times. Despite the economy's robust growth, with a forecasted 7.3 per cent increase in Gross Domestic Product for the fiscal year 2023-24, the government …

Centre to take foot off capex pedal after FY25 budget
11 months, 2 weeks ago

Centre to take foot off capex pedal after FY25 budget

Live Mint  

NEW DELHI : After an expected spurt in the next fiscal year, government capital expenditure may grow at a more sedate pace in the years ahead as the Centre sets its sights on fiscal consolidation, two people aware of the plans said. A second reason for the modest increase in capex after 2024-25 is the saturating fund absorption capacity of …

Highways Ministry, Railways Achieve Around 40% Capital Expenditure Till July, Aim to Spend 90% by December
1 year, 4 months ago

Highways Ministry, Railways Achieve Around 40% Capital Expenditure Till July, Aim to Spend 90% by December

News 18  

With about eight assembly polls and the Lok Sabha elections scheduled in the next one year, the Union government is prioritising its spending. Of the Rs 5 lakh crore allocated to these ministries for the current financial year, the two have already spent Rs 2.06 lakh crore by July-end. According to a Railway Ministry official, by July-end, the national transporter …

Explained: The logic behind long-term capex loans for states
1 year, 10 months ago

Explained: The logic behind long-term capex loans for states

Live Mint  

Union budget 2023-24 has proposed to continue with the 50-year interest-free loan to state governments that aid infrastructure investment. Most of it would be at the discretion of states, while parts of the expenditure will also be linked to, or allocated for, scrapping old government vehicles; urban planning reforms; financing reforms in urban local bodies to make them creditworthy for …

Capex bet and a welfare miss: Story of Budget in nine charts
1 year, 10 months ago

Capex bet and a welfare miss: Story of Budget in nine charts

Live Mint  

In the last full-year Budget before the 2024 general elections, finance minister Nirmala Sitharaman delivered her shortest speech, hitting all the right notes. HEARTY CAPEX In 2023-24, which is likely to see a global growth slowdown, the Centre has budgeted a record capital expenditure of ₹10 trillion, up nearly 37% from the revised estimate of the ongoing year. Meanwhile, following …

Welfare spending cut could pose significant livelihood challenges
1 year, 10 months ago

Welfare spending cut could pose significant livelihood challenges

Hindustan Times  

Since the 2021-22 Budget, the Union government has steadily pivoted from welfare spending to capital expenditure. In essence, welfare spending is now relegated to the margins, in the hope that investment in infrastructure will, to quote the finance minister, have a “large multiplier impact on growth and employment and ramp up the virtuous cycle of investment and job creation.” From …

Trains, Roads, 5G, Defence: Where Does Rs 10 Lakh Cr Capex Budget Go? Three-fourth in 4 Ministries, Depts
1 year, 10 months ago

Trains, Roads, 5G, Defence: Where Does Rs 10 Lakh Cr Capex Budget Go? Three-fourth in 4 Ministries, Depts

News 18  

More highways and expressways, Vande Bharat trains, rapid laying out of 5G infrastructure and shoring up India’s defences – this is the top priority of the Narendra Modi-led government in the next financial year with just four ministries or departments accounting for nearly 73 percent of the massive Rs 10 lakh crore capex budget in 2023-24. The budget documents show …

Great Budget for CapEx and Railways, Not Bad for Direct Taxes - News18
1 year, 10 months ago

Great Budget for CapEx and Railways, Not Bad for Direct Taxes - News18

News 18  

Finance Minister Nirmala Sitharaman began her speech by calling Budget 2023 the first one in Amrit Kaal. Unfortunately, there were few takers for the new scheme because one could pay fewer taxes by using the various exemptions in the old scheme. There will be less complicated tax calculations involved in using the exemptions and actually lower tax liabilities just by …

The forced capex gamble in Budget 2023
1 year, 10 months ago

The forced capex gamble in Budget 2023

New Indian Express  

The more important question is, where is the money for such large government expenditure coming from? The government cannot increase tax collections dramatically since its tax structure is already skewed, with a heavy burden on the common people to the benefit of corporates who have not reciprocated. The Economic Survey tells us that demand for NREGA work continues to be …

Union Budget 2023-24: Aiming For A Fine Balance
1 year, 10 months ago

Union Budget 2023-24: Aiming For A Fine Balance

News 18  

The Indian economy has been recovering well from the pandemic. With this context, restricting GFD/GDP to around 5.8 per cent should be targeted and ensure the government remains committed to the target of reaching 4.5 per cent by FY2026. We see five key reasons for a limited space for a “populist” Budget — Lower tax revenue growth, given lower GDP …

Credit challenges: On credit flow and all-round capital spending
1 year, 11 months ago

Credit challenges: On credit flow and all-round capital spending

The Hindu  

The Reserve Bank of India’s ‘Report on Trend and Progress of Banking in India’, paints a picture of credit growth having rebounded smartly, with the consolidated balance sheets of Indian commercial banks showing double-digit expansion after a seven-year gap. With retail inflation and concerns about price stability eroding savers’ real returns as well as confidence to save, banks have found …

Only a handful of large firms ready for big spending
2 years, 2 months ago

Only a handful of large firms ready for big spending

Live Mint  

MUMBAI : Finance minister Nirmala Sitharaman’s expectation that private sector capital spending will power India’s economic growth appears to be wishful thinking as most companies, barring a handful of large conglomerates and state-run corporations, remain wary of new investments amid rising interest rates. Bankers said that the private capex cycle is quite uneven as large spending is mainly restricted to …

Greater capital expenditure is the highlight of the Budget
2 years, 10 months ago

Greater capital expenditure is the highlight of the Budget

The Hindu  

This Budget has made some very effective announcements to accelerate growth as we come out of a prolonged pandemic which has weighed on growth significantly. Here are some takeaways: Capex and deficits For FY22, the revised estimate for capex stood at ₹6 trillion, but excluding the one-time Air India charge, it would have been closer to ₹5.5 trillion. In terms …

Story of Budget 2021, in 9 charts
3 years, 10 months ago

Story of Budget 2021, in 9 charts

Live Mint  

Even as countries across the world raised spending aggressively to counter the economic impact of the covid-19 pandemic, India had remained an outlier. The share of Union spending on health, education, and rural development ministries will be lower in the upcoming fiscal year than in the fiscal 2015-2021 period. Source: Budget Documents In the ongoing fiscal year, growth in capital …

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