Home Financial Record Infra-record spending by Indian railways; investments up 64%

Infra-record spending by Indian railways; investments up 64%

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The Union Ministry of Railways spent an amount of 60,434 crore during the April-October period of the current fiscal year, up 64% from the 36,681 crore spent during the same period of the previous fiscal year, according to government data. This is a record expenditure by the Ministry of Railways on the infrastructure front.

In terms of percentage use of capex compared to budget allocation, the Ministry of Railways also recorded an achievement of 56% in April-October FY22, compared to 52% during the same period during the year. ‘Previous exercice.

The amount spent during the period, meanwhile, is up 60% from the infrastructure spending worth 37,611.74 crore incurred by the ministry during the pre-pandemic period of. April to October FY20. However, in terms of percentage of budgeted expenditure, the achievement in FY20 was over 57%. From a budget usage percentage perspective, FY19 was even better when the railways used 58% of the budget allocation between April and October.

Putting the data into perspective, a source from the Ministry of Railways told Fortune India: “When viewed as a percentage of total spending, performance in previous years may look better. But you also have to see the context of the size of the budget, which has grown considerably over the past two years. The investment allocation in the budget has increased by over 50% in the current fiscal year, compared to approximately 70,000 crore in the previous fiscal year.

In the future, the areas on which the allocated amount is used are the construction of new lines, the doubling of existing lines, expenditure for traffic facilities and road construction on bridges and under bridges for operations without sewing. The railways annual plan for the current fiscal year calls for an investment of 40,932 crore in new lines, up 52% ​​from 26,971 crore in fiscal year 21, doubling 26,116 crore, 5,263 crore in traffic facilities and an investment of over 7,000 crore in road construction over bridges and under bridges.

In line with the government’s plan to stimulate economic growth, the Ministry of Finance has significantly increased infrastructure spending over the past two years. The allocation for the capital expenditure of the Ministry of Railways in the current fiscal year is almost double the 55,000 crore yen allocated under the heading in the 2017-2018 budget, according to the budget documents.

The source from the Ministry of Railways pointed out that the ministry is also implementing the projects at a much faster pace now. It can be noted that against the budget allocation of 55,000 crore for infrastructure spending in 2017-18, the ministry had only used ₹ 22,901 crore – 42% of the allocated amount – during the period April- October 2017 – 18.

Given the rapid implementation of the projects, the ministry will most likely demand an upward revision of the current fiscal year in the next budget, sources said. The finance ministry can also continue the infrastructure push and allocate higher performing ministries a higher amount in the next fiscal year.