Finance Minister Nirmala Sitharaman issued a sharp rebuttal on Tuesday after P Chidambaram flagged a ‘cut’ in capital expenditure. She also accused the senior Congress leader of employing “selective arithmetic and flawed comparisons” to serve “political rhetoric”.
“Budget Estimates are prepared before the financial year begins and naturally evolve into Revised Estimates based on expenditure trends, implementation capacity, and emerging priorities. This is standard practice in public finance,” Sithraman wrote on X.
Chidambaram had claimed earlier in the day that the government had cut Rs 92,682 crore from central government capital expenditure and Rs 90,887 crore from the assistance to state governments for capex. He compared the BE and RE figures of capex for 2024-25 as outlined in Budget documents to underscore his point.
“I asked the reasons for the cut. The Hon’ble FM denied there was any cut! I am speechless,” he added in a lengthy social media post.
Sitharaman however contended that capex had been influenced by several factors in FY25 — including the Model Code of Conduct during Lok Sabha elections, extreme weather events, and lower-than-expected spending by States and certain central agencies. Many states had also ‘failed to submit utilisation certificates’ — which made it imprudent to release further funds.
“A year-on-year comparison shows clearly that the Capex numbers have risen from BE (23-24) at Rs. 10.01 lakh crores to BE(24-25) at 11.11 lakh crores. This is a YoY increase of 11.11 %. The BE (25-26) for Capex stands at Rs 11.21 lakh crores, higher than BE 24-25. Similarly, The RE (23-24) was estimated at Rs. 9.50 lakh crores and the RE (24-25) is estimated at Rs. 10.18 lakh crores. This clearly indicates an increase of 7.3%. There has been no cut in the Capex of the Central government,” she wrote.
“I have mentioned in the House that the actual releases for SASCI (as of 26.3.25) in FY 24-25 is Rs. 1,46,362 crores. This is an increase over RE 24-25, what is there to be ‘speechless’?” she added.