Budget 2025-26: Capex Rises by 10.23%, Prioritizing Infrastructure, Says FM Sitharaman

Synopsis

In a post-budget interview, Finance Minister Nirmala Sitharaman emphasized the government's dedication to capital expenditure, highlighting a significant 10.23% increase in Budget 2025-26, which positions infrastructure as a key priority while also enhancing consumption.

Key Takeaways

10.23 percent increase in capex for Budget 2025-26.
Projected capex spending of Rs 11.21 lakh crore.
4.3 percent of GDP allocated to capex.
Focus on balancing capex and consumption for economic growth.
Investment in key sectors like health and education remains a priority.

New Delhi, Feb 2 (NationPress) Finance Minister Nirmala Sitharaman shared in a post-budget conversation with NDTV that the Government has maintained its commitment to capital expenditure (capex) over recent years, while also significantly enhancing consumption.

"A growth in capex by 10.23 percent compared to the Revised Estimate (RE) of 2024-25 brings it to over Rs 11.21 lakh crore. This is a substantial achievement... The consistent public investment in asset creation has reached a point where even a 10.23 percent rise appears typical," she stated during her discussion with NDTV's Editor-in-Chief Sanjay Pugalia.

"Our focus on capex remains unwavering. We are also providing states with interest-free capex funds," she highlighted.

Sitharaman underscored that prioritizing infrastructure remains crucial. The Government's capex spending is anticipated to be 4.3 percent of GDP this year, with a projected fiscal deficit of 4.4 percent for the next year, she noted.

Since the onset of the COVID-19 pandemic, the Government has consistently increased capex by 10-15 percent, having announced a capex of Rs 11.11 lakh crore last year. The Finance Minister asserted that it would be inaccurate to characterize the Union Budget 2025 as lackluster concerning capex.

She also mentioned that the Government is not solely shifting towards consumption; rather, it aims to promote consumption while contributing to the overall growth metrics.

"For growth, instruments and triggers are essential—just as we invested in capex over the last five years with an eye on the multiplier effect to stimulate the economy—thus, a consumption boost is also vital. However, our primary objective was to acknowledge honest taxpayers," Sitharaman remarked to NDTV.

She stated that the Government has achieved a balance between fortifying the foundation of a 'Viksit Bharat' and equally prioritizing crucial sectors such as health, nutrition, and education through welfare initiatives.