The Union government is likely to increase its capex allocation to a record ₹12.5 lakh crore in FY25. This is a significant increase from the ₹10.7 lakh crore allocated in FY24. The increase in capex allocation is likely to be driven by the government’s focus on infrastructure development.
Central Government Capex over last 4 years
| Year | Capex (₹ trillion) | Growth from Previous Year (%) |
|---|---|---|
| 2020-21 | 3.26 | -21.2% |
| 2021-22 | 5.54 | 70.3% |
| 2022-23 | 7.28 | 31.5% |
| 2023-24 | 10.00 | 37.4% |
The government has identified infrastructure development as a key driver of economic growth. In the recent budget, the government announced a number of initiatives to boost infrastructure investment, including the National Infrastructure Pipeline (NIP). The NIP is a ₹111 lakh crore investment plan that aims to develop a network of highways, railways, airports, and ports.
The increase in capex allocation is likely to have a positive impact on the economy. It will lead to job creation and boost economic activity. Additionally, it will improve the quality of infrastructure, which will make it easier for businesses to operate and will reduce the cost of doing business.
Benefits of increased capex allocation
The increased capex allocation is likely to have a number of benefits, including:
- Increased job creation
- Boosted economic activity
- Improved infrastructure quality
- Reduced cost of doing business
Overall, the Union government’s decision to increase its capex allocation is a positive one. It is likely to have a significant impact on the economy and will help to improve the quality of life for all Indians.
Here are some additional details about the capex allocation:
- The capex allocation is likely to be focused on the following sectors:
- Roads
- Railways
- Airports
- Ports
- Power
- Irrigation
- Urban development
- The government is also likely to increase its spending on social infrastructure, such as education and healthcare.
- The increase in capex allocation is likely to be funded by a combination of government borrowing and private investment.