To overcome the shortage of private investments, the Centre has been spending big in the first few months of the financial year 2016-17 to pump up the economy. At Rs 90,000 crore, the Plan Expenditure in the first two months of the fiscal was the highest in the last five years; the spending is likely to have crossed Rs 1-lakh crore in the first quarter. The Plan Expenditure for the whole of 2016-17 is estimated at Rs 5.5-lakh crore, an increase of 15.3 percent from the Budgeted target of Rs 4.65-lakh crore last fiscal.
Data with the Controller-General of Accounts revealed that the Centre's Plan Expenditure totalled Rs 90,570 crore by May 31, against Rs 62,106 crore in the corresponding period a year ago. Key spenders during the period included the Ministries of Rural Development and Human Resource Development as well as infrastructure ministries of highways, power and railways. Transfers to States by the Finance Ministry also doubled to Rs 7,030 crore, while the focus on Swachh Bharat and clean drinking water seems to have increased.
However, economists feel that within the Plan Expenditure, it is the spending on revenue account that was on the higher side in the period and could indicate spending held back in the previous fiscal.
"Much of the Plan Expenditure may have been that which was held up in the last fiscal. Had it been new demand, it would have shown on the capital account," said DK Srivastava, Chief Policy Adviser, EY.
Between April and May 2016, the Plan revenue expenditure was Rs 74,609 crore, or 18.5 per cent of the full-year estimate, against Rs 43,731 crore, or 13.3 per cent of the BE in the last fiscal. Plan capital expenditure was Rs 15,961 crore by May 31, 2016 against Rs 18,375 crore a year ago.
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Centre spends big to substitute for private investments
By IndianMandarins - 2016-07-07 11:32:42
To overcome the shortage of private investments, the Centre has been spending big in the first few months of the financial year 2016-17 to pump up the economy. At Rs 90,000 crore, the Plan Expenditure in the first two months of the fiscal was the highest in the last five years; the spending is likely to have crossed Rs 1-lakh crore in the first quarter. The Plan Expenditure for the whole of 2016-17 is estimated at Rs 5.5-lakh crore, an increase of 15.3 percent from the Budgeted target of Rs 4.65-lakh crore last fiscal.
Data with the Controller-General of Accounts revealed that the Centre's Plan Expenditure totalled Rs 90,570 crore by May 31, against Rs 62,106 crore in the corresponding period a year ago. Key spenders during the period included the Ministries of Rural Development and Human Resource Development as well as infrastructure ministries of highways, power and railways. Transfers to States by the Finance Ministry also doubled to Rs 7,030 crore, while the focus on Swachh Bharat and clean drinking water seems to have increased.
However, economists feel that within the Plan Expenditure, it is the spending on revenue account that was on the higher side in the period and could indicate spending held back in the previous fiscal.
"Much of the Plan Expenditure may have been that which was held up in the last fiscal. Had it been new demand, it would have shown on the capital account," said DK Srivastava, Chief Policy Adviser, EY.
Between April and May 2016, the Plan revenue expenditure was Rs 74,609 crore, or 18.5 per cent of the full-year estimate, against Rs 43,731 crore, or 13.3 per cent of the BE in the last fiscal. Plan capital expenditure was Rs 15,961 crore by May 31, 2016 against Rs 18,375 crore a year ago.
