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An 11.1% increase in capital expenditure, announced by the finance minister Nirmala Sitharamn on Thursday, is below than expectation but experts hope this will be significantly revised upwards in the full budget later this year.
Nirmala Sitharaman s no big bang budget holds back expected welfare spending and sops for voters. The enigmatic numbers 1111111 and 11.11 are related to capital expenditure. Sitharaman proposes to raise the capital expenditure target by 11.11% to Rs. 11.11 lakh crore for the next fiscal year. The hike in the interim budget is significant but not as dramatic as in previous budgets.
The 2.7% hike in the budget for road transport and highways will be committed to ongoing projects. The government plans to attract private investment through build-operate-transfer (BOT) and public-private-partnership (PPP) models, as well as asset monetisation. The government aims to bid out 54 road projects worth over ₹2.2 lakh crore. However, experts note that the real increase in capital expenditure is not more than 5% due to a 6% increase in construction material costs. The government aims to reduce travel time, enhance travel experience, and lower logistics costs.