The Ministry of Finance has reported a remarkable upsurge in capital expenditure (capex) among 54 large Central Public Sector Enterprises (CPSEs) and five departmental arms, all of which have an annual capex target of ₹100 crore or more. As of August in the current fiscal year, capex has already reached approximately 42.5% of their yearly goal, totaling around ₹3.1 trillion. This represents a substantial 37% increase when compared to the same period in FY23.
The government is actively encouraging major public undertakings in the infrastructure and refinery sectors to accomplish 90% of their targets by the end of the third quarter, underscoring its commitment to fortifying national infrastructure.
Here are some key highlights:
• Railways: Excluding the Dedicated Freight Corridor Corporation of India and Kolkata Metro Rail Corporation, the Railway Board has disbursed approximately ₹1.13 trillion (46.6%) of the capex target of roughly ₹2.44 trillion.
• National Highways Authority of India (NHAI): NHAI has utilized approximately ₹75,168 crore (46.4%) against its annual capex target of around ₹1.62 trillion in the first five months of FY24.
• Indian Oil Corporation (IOCL): IOCL has achieved 51% of its capex target, which amounts to approximately ₹30,395 crore. This achievement is driven by the resumption of work on pipeline projects and the expansion of refining capacity.
• Oil and Natural Gas Corporation (ONGC): ONGC, India's largest crude oil and natural gas producer, has expended approximately ₹12,791 crore in the first five months, out of its annual capex target of ₹30,125 crore.
• National Thermal Power Corporation (NTPC): NTPC has successfully reached 29% of its annual target, which stands at ₹22,454 crore.
• HPCL and BPCL: Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL) have respectively utilized around ₹6,024 crore (59%) and ₹3,278 crore (33%) of their annual targets.
The capex reports of these CPSEs undergo monthly review by the Prime Minister’s Office (PMO), underscoring the government's dedication to prudent financial management.
In the Union Budget for 2023-24, Finance Minister Nirmala Sitharaman announced an impressive 33% increase in the capex allocation, totaling approximately ₹10 trillion.
The government's emphasis on a capex-led recovery demonstrates a proactive approach to stimulating the economy, particularly in light of potentially subdued private sector investments.
