Central public sector enterprises (CPSEs) and other major government agencies, including the Railway Board and the National Highways Authority of India (NHAI), achieved aggregate capex of Rs 3.36 lakh crore, or 40% of the annual capex target, in the first five months of FY27.
However, the entities’ monthly capex growth moderated to around 5% in August, compared with robust growth of 35% in July, largely due to the impact of monsoon rains.
These state-run entities, with an annual capex target of Rs 100 crore and above, invested Rs 3.36 lakh crore in April-August of FY27, 23.5% more than the Rs 2.72 lakh crore invested in April-August of FY26. The capex achievement by these entities 36.5% of the FY26 target.
In whole of FY26, these state-run entities invested Rs 8.64 lakh crore, reaching 110% of their Rs 7.85 lakh crore target. The target is Rs 8.43 lakh crore for the current financial year.
Monthly data show that these entities reported their sharpest increase in April, when capex jumped 62.9% year-on-year to Rs 81,108 crore, followed by a 35.2% rise in July to Rs 72,218 crore. Growth moderated to 15% in May, while June and August recorded more modest increases of 4.9% and 4.8%, respectively.
The Railway Board and NHAI are the biggest investors. For context, FY27 capex for the Railways and NHAI is estimated at Rs 4.52 lakh crore, equivalent to 54% of the total capex target for state-run agencies in FY27. These two entities are almost fully funded through the Union Budget and account for 37% of the Centre’s overall FY27 capex estimate of Rs 12.2 lakh crore.
The Centre is nudging states and public sector enterprises to maintain the momentum in capex to boost economic activity, even as private capex has started to expand. The Centre’s capital expenditure grew by a robust 30% year-on-year in April-July of the current financial year.
States’ aggregate capital expenditure likely grew by a moderate 11% in April–July of the current financial year, compared with the year-ago period.