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Centre sanctions Rs 600 bn long-term capex funds to states
The central government has sanctioned Rs 600 billion of long-term capital expenditure funds to states this fiscal, making a strong beginning to the scheme announced earlier this year to build roads, ports, bridges, airports and highways across the country.
The scheme envisions providing Rs 1 trillion in interest-free loans to states over and above the normal borrowing limits, so that local governments have more financial resources to invest in productive assets, which will create jobs.
The amount sanctioned thus far is a fourfold increase from the allocation made in the scheme's first year—Rs 150 billion in FY22—indicating that it is well received by states. With this in mind, the Centre has increased capital expenditure allocation in this year's budget by 35% to Rs 7.5 trillion. The Centre's additional allocation includes a Rs 1 trillion capex fund.
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