Union Budget 2022 : Sharp Increase of 35.4% In Capital Expenditure

“The outlay for capital expenditure in the Union Budget is being stepped up sharply by 35.4% from Rs. 5.54 lakh crore in the current year to Rs. 7.50 lakh crore in 2022-23”, said the Union Finance and Corporate Affairs Minister Smt. Nirmala Sitharaman during her Budget Speech here in Parliament today.

Presenting the Union Budget 2022-23, she told that the capital expenditure has thus increased to more than 2.2 times the expenditure of 2019-20 and it would be 2.9% of GDP in 2022-23. The virtuous cycle of investment requires public investment to crowd-in private investment. For the private investments to rise to their potential and to the needs of the economy, public investment must continue to take the lead and pump-prime the private investment and demand in 2022-23, said the Minister.

Effective Capital Expenditure:

With capital expenditure taken together with the provision made for creation of capital assets through Grants-in-Aid to States, the ‘Effective Capital Expenditure’ of the Central Government is estimated at Rs. 10.68 lakh crore in 2022-23, which will be about 4.1% of GDP, informed the minister.

Green Bonds:

Smt. Sitharaman announced that sovereign Green Bonds would be issued for mobilizing resources for green infrastructure as a part of the government’s overall market borrowings in 2022-23. The proceeds would be deployed in public sector projects which help in reducing the carbon intensity of the economy.

The Finance Minister highlighted the role of capital investments in ensuring speedy and sustained economic revival and consolidation by creating employment opportunities, inducing enhanced demand for manufactured inputs from large industries and MSMEs, services from professionals, and help farmers through better agri-infrastructure.

PIB Release ID: 1794143