Budget 2021: Capex target raised to Rs 5.54 lakh cr in FY22

The capital expenditure target in this year's Union Budget has been increased to Rs 5.54 lakh crore for financial year 2021-22. This is 34.5 per cent higher than budget estimate of FY21 at Rs 4.12 lakh crore. The Finance Minister also announced Rs 2 lakh crore for states and autonomous bodies.

"For 2021-22, I propose a sharp increase in capital expenditure and thus have provided Rs 5.54 lakh crores which is 34.5 per cent more than the BE of 2020-21. Of this, I have kept a sum of more than Rs 44,000 crores in the Budget head of the Department of Economic Affairs to be provided for projects/programmes/departments that show good progress on capital expenditure and are in need of further funds," FM Sitharaman said.

Amid an unprecedented pandemic, there has been demands of increase in spending by government to drive economic growth and revive demand. In this vein, FM Sitharaman said that the government is set to end FY21 with more expenditure than the actual budget estimate.

"It was our effort that in spite of resource crunch we should spend more on capital and we are likely to end the year at around Rs 4.39 lakh crore which I have provided in the RE 2020-21," she said.

"Over and above this expenditure, we would also be providing more than Rs 2 lakh crores to states and autonomous bodies for their capital expenditure," the Finance Minister further added.

FM Sitharaman also mentioned that specific mechanisms will be devised to encourage states to spend more of their budget on creation of infrastructure.

FULL COVERAGE: Budget 2021

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