Finance minister Nirmala Sitharaman on Friday said India’s long-term growth prospects are “embedded in public capital expenditure” programmes, indicating that India’s renewed focus on capex in recent years will continue.
Participating in the third meeting of the G-20 finance ministers and central bank governors in Bali, Sitharaman also highlighted that evidence-based policy-making is vital for resilient economic systems.
The Centre has budgeted a capex of Rs 7.50 trillion for FY23, up 27% from the actual spending of Rs 5.93 trillion (including infusion into Air India Asset Holdings) in FY22, betting big on the high multiplier effect of such spending to spur economic growth. In the current fiscal, about Rs 1 trillion of the budgetary target will be spent by states, as they have been provided loan support to boost their asset creation.
The economy’s reliance on public capex has grown in recent years, as private investments have remained elusive or are limited to a few sectors in the aftermath of the pandemic. The Centre front-loaded capex and spent Rs 1.07 trillion in April-May, up 70% from a year before.
Sustainable global recovery, she said, needs to be “pivoted on climate actions” and the focus should be on scaling up climate finance and propelling green transitions.
Taking part in the second session of the ongoing G20 meeting, the finance minister also shared views on the G-20’s Health Agenda, calling for immediate mobilisation and deployment of resources for health emergencies.
“FM Smt. @nsitharaman called for a global coordination mechanism with @WHO at its centre. FM also said that India is committed to supporting all efforts to #protect and #prepare against any future #pandemic,” the finance ministry said in a tweet.