Budget 2024 Continues Government Focus On Infrastructure
Continuing its focus on infrastructure development, the Interim Budget 2024 has proposed to raise capital expenditure—for the fourth consecutive year—by 11.1% to Rs 11.11 lakh crore, which is 3.4% of the GDP. This is also in line with market expectations. The infrastructure spending in the fiscal year 2024-25 is being projected at 3.4% of GDP, Union Finance Minister Nirmala Sitharaman said during her interim Budget speech on Thursday, February 1. India's infrastructure industry hoped that the government would unveil a long-term plan and timeline for enhancing infrastructure in the country as part of the Interim Budget. “The next five years will be years of unprecedented development and golden moments to realize the dream of developed India by 2047," Sitharaman said. She said the next generation of reforms will be carried out in consultation with state governments. “Building on the massive tripling of the capital expenditure outlay in the last four years, resulting in a huge multiplier impact on economic growth and employment creation, the outlay for the next year is being increased by 11.1 percent to Rs 11,11,111 crore. This would be 3.4% of the GDP (gross domestic product),” she added. Some major announcements that will give a boost to infrastructure includes, three major economic railway corridor programmes will be implemented– (1) energy, mineral, and cement corridors, (2) port connectivity corridors, and (3) high-traffic density corridors. The projects have been identified under PM Gati Shakti for enabling multi-modal connectivity. This will provide the much-needed push to the logistics industry and in the long term, reduce cost for all industries. As part of the government's Gati Shakti master plan, new50-year interest-free loans to state governments have been extended for another year. The PM Gati Shakti Master plan, a pet project of Prime Minister Narendra Modi which found prominent mention in Sitharaman’s budget speech of 2022-23, involves holistic policymaking for the seven infrastructure sub-sectors, with one digital portal that can be accessed by all stakeholders for real-time information. The Ministry of Road Transport and Highways (MoRTH) will get a Union Budget allocation of Rs 2.78 lakh crore in FY25, up 2.8 percent on year. While road construction in the country has slowed in the current fiscal, this allocation may help boost the construction of highways and expressways amid rising interest expenses and increasing land acquisition costs. The Indian Railways will receive a capex push of Rs 2.52 lakh crore for the financial year 2024-25, an increase of 5 percent from Rs 2.4 lakh crore allocated a year ago. In her speech, the finance minister also said that around 40,000 trains running as part of the Indian Railways will be upgraded to Vande Bharat trains.
Tags : railway corridor programmes Ministry Road Transport Highways long-term plan PM Gati Shakti