The capital expenditure outlay for the Ministry of Road Transport and Highways (MoRTH) is likely d to increase 25% on year in the next financial year to Rs 3.2 trillion, according to an official source. This implies the key infrastructure sector that has long witnessed a famine of private risk capital and lately been solely funded out of Budget rather than borrowings, will continue with the same model to keep capex pace in the next fiscal year.
The outlay is being finalised after taking into account the higher funding requirements for ongoing programmes like Bharatmala, and newer schemes being launched, the official said
The pre-budget meeting of MoRTH with the Ministry of Finance on revised estimates for 2022-23 and budgetary estimates for 2024-25 has already been held, the source said.
The quantum of increase expected for 2024-25 is similar to what was seen in the allocation for the currebt financial year, the official who did not wish to be named, pointed out. In 2023-24, the ministry has been provided Rs 2.58 trillion for spending, 25% more than Rs 2.05 trillion it spent in 2022-23.
In the first seven months of this year the ministry has spent Rs 1.66 trillion or 64% of its outlay and constructed 4474 km of highways. The highway construction typically picks up in the second half of the financial year and most of the work gets completed at the end of last quarter. The target of highway construction for this year is 13,800 km which could necessitate additional funds for the year in the revised estimates for the year.
Some of the increase expected for 2024-25 will cover the inflation part of road construction activities while the revised cost estimate of the flagship highway building programme Bharatmala awaits the nod of the Cabinet Committee on Economic Affairs (CCEA). The cost of Bharatmala has risen to Rs 10.6 trillion from Rs 5.35 trillion when it was first approved by the CCEA in October 2017.
Bharatmala envisages development of 34,800 km of national highways corridors. Till date work for 26,348 km of stretches have been awarded that would cost Rs 8.24 trillion. Of the total target, 14,300 km of highways under the project have been constructed.
As the award of highway construction projects under Bharatmala are coming to an end, the government is examining the next project to take on. There is talk of Bharatmala 2 programme while some reports suggest that something more ambitious is also being examined.
The ministry, like other departments, has also drawn up a 25-year plan of action to coincide with the completion of 100 years of independence. A part of this programme mentions a 20-year plan to build 50,000 km of highways over the next 20 years at the cost of Rs 20 trillion.
Even though 2024 is the election year and the government will be presenting an interim budget, the expenditure budget will mention detailed expenditure for the full year under various heads. Along with the interim budget the Appropriation Bill, that authorises the government to withdraw money from the consolidated fund of India for expenditure, will be the Appropriation (Vote on Account) Bill.
When the budget for the full year is passed by the new government the allocation numbers may slightly change.