Capex by CPSEs, NHAI, and Railways Rises 15% in Q1

16 Jul 2025 CW Team

Central public sector enterprises (CPSEs), along with key government agencies such as Indian Railways and the National Highways Authority of India (NHAI), reported a 15% increase in capital expenditure (capex) during the first quarter of the current financial year.

Officials indicated that in Q1 of FY26, these entities collectively spent ₹1.67 lakh crore, which accounts for 21.34% of their full-year capex target. In comparison, the same period in the previous year saw a capex of ₹1.46 lakh crore, representing 18.5% of the annual goal. Entities with annual capex targets of Rs 1 billion or more have set a combined target of Rs 7.85 trillion for FY26. In the previous fiscal, they had surpassed their goal, investing Rs 8.1 trillion against a target of Rs 7.86 trillion—achieving 103% of the planned outlay.

Railways and NHAI are expected to play a dominant role again in FY26, with a combined capex estimate of Rs 4.4 trillion. This accounts for 56% of the total capex targeted by CPSEs and other government agencies, and around 40% of the Centre’s overall capital expenditure for the year. These two sectors are primarily funded through the Union Budget.

In addition, petroleum sector undertakings are projected to invest Rs 1.3 trillion in FY26, largely financed through internal accruals and borrowings rather than government funding.

Government sources explained that this capex push is part of a broader strategy to drive economic revival through increased public investment, involving the Centre, state governments, and public enterprises. They added that the Centre's capital expenditure had already surged by 54% in April-May 2025, although this sharp increase was partly attributed to a low base from the previous year.

News source: Financial Express

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