26 Oct 2020
Govt. to seek Parliament nod for Rs 370 bn spending on infra development
Picture credits: DNA India
The government will seek Parliament’s approval for Rs 370 billion additional spending on infrastructure development in the second batch of supplementary demands for grant.
Earlier this month, Finance Minister Nirmala Sitharaman had announced additional budget of Rs 250 billion as capital expenditure (capex) on roads, defence, water supply, urban development and domestically produced capital equipment.
Besides, the central government approved issuance of a special interest-free 50-year loan to states of Rs 120 billion for infrastructure development. Approval for this additional spending will be sought through second supplementary demands for grants, sources said.
This was part of the third stimulus announced by the government earlier this month to boost demand during the festival season. The additional spending of Rs 370 billion is over and above Rs 4.13 trillion capex plan approved by the government in Budget 2020-21.
For various schemes of Aatmanirbhar Bharat Abhiyan package, the government sought approval of additional spending through first batch of supplementary demands for grants last month.
The second supplementary demands for grants is usually presented during the winter session of Parliament.
The government has assured various infrastructure related ministries and departments that it will provide more money if needed and it is ready to provide the additional funds even at the revised estimates level, sources said.
Highlighting the importance of infra development, the Finance Minister recently said money spent on infrastructure and asset creation has a multiplier effect on the economy.
It not only improves current economy but also future GDP, she had said while announcing Rs 370 billion extra spending for infra development.
Ms. Sitharaman last week exhorted central public sector enterprises (CPSEs) under coal and petroleum and natural gas to achieve by December 75 per cent of their planned capital expenditure (capex) target for 2020-21.
This was the fourth in the ongoing series of meetings that the Finance Minister is having with various stakeholders to accelerate the economic growth amid the COVID-19 pandemic.
While reviewing the performance of CPSEs, Ms. Sitharaman had said capex by CPSEs is a critical driver of economic growth and needs to be scaled up for the financial year 2020-21 and 2021-22.
The government had pegged capex spending of Rs 4.13 trillion for the current financial year, as per the Budget 2020-21.
Story credit: Press Trust of India