Public Infrastructure Investments Surpass Pre-Covid Levels: Ministry

The Rajya Sabha was informed that public infrastructure investments, as a share of the country’s GDP, have now surpassed pre-pandemic levels. Minister of State for Finance Pankaj Chaudhary reported that infrastructure spending by the Union and state governments, along with Central Public Sector Enterprises, reached 5.87% of GDP in 2023-24. This is higher than 5.03% in the previous year and 5.76% in 2019-20, before the pandemic. In absolute terms, investments rose to Rs 17.35 trillion in 2023-24, up from Rs 13.57 trillion in the previous fiscal and Rs 11.57 trillion in 2019-20. The Central government has significantly boosted its capital spending in recent years, leveraging the high-multiplier effect to accelerate economic recovery post-Covid. Annual capital expenditure (capex) growth has ranged from 17% to 39% since FY22. For the current fiscal year, the Centre has allocated a record Rs 11.11 trillion for capex, which includes Rs 1.5 trillion in interest-free, long-term loans to states to support their infrastructure projects. Chaudhary emphasised that this increased investment in infrastructure is expected to stimulate private sector participation. To further attract private investment, the government has promoted public-private partnerships through viability gap funding and reforms to support innovative financing mechanisms like InvITs, REITs, and IDFs. Additionally, long-term infrastructure financing has been bolstered with the establishment of institutions such as the National Investment and Infrastructure Fund and the National Bank for Financing Infrastructure and Development. (ET)

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