The central government has proposed to increase the capital expenditure by 34.5 percent to Rs 5.5 lakh crore in FY 2021-22 to accelerate economic growth through the creation of infrastructure. For the current financial year, it has been increased from the budget estimate of Rs 4.12 lakh crore to Rs 4.39 lakh crore.
Union Finance Minister Nirmala Sitharaman said that capital expenditure has been increased in FY 2020-21. We gave Rs 4.12 lakh crore towards capital expenditure. Even after resource depletion, our endeavor was to increase capital expenditure. We are going to spend about Rs 4.39 lakh crore this financial year. We have made this provision in the revised budget for 2020-21.
He proposed to increase the capital expenditure further to Rs 5.54 lakh crore for the next financial year. This is 34.5 percent more than the budget estimate of Rs 4.12 lakh crore for 2020-21. Out of this, he has set aside more than Rs 44 thousand crores for the Department of Economic Affairs. This will be given to better performing and needy departments on the capital expenditure front. He said that above this expenditure, the government will give more than two lakh crore rupees to the states and autonomous bodies for the expenditure. He said that we will also work on making special arrangements to motivate states to spend more on the creation of infrastructure.
NIP extension, 7400 schemes included
The government has proposed three steps in the General Budget to achieve the target of the National Infrastructure Pipeline (NIP) in the coming years. Under this, institutional structures will be created, special emphasis on the monetization of assets and capital expenditure will be increased in the Center and State budgets.
Finance Minister Nirmala Sitharaman said in the budget speech that the NIP started in December 2019 with 6,835 projects has been expanded and now it has 7,400 projects. Around 217 projects worth Rs 1.10 lakh crore have been completed under some important infrastructure ministries. NIP is a unique initiative. Under this, a world-class infrastructure will be created across the country, which will improve the lifestyle of all citizens. This is significant towards achieving the goal of becoming a $ 5 trillion economy by the 2025 fiscal year.
Budget disappointment in the tourism and hospitality sector
Many celebrities in the industry have said that the budget has disappointed the tourism and hospitality sector. However, measures to strengthen the infrastructure may help. Nakul Anand, president of the Federation of Associations in Indian Tourism and Hospitality (FAITH) said, FAITH had made several recommendations to the government for the tourism sector in the budget. These recommendations included making export income tax-free and exempting income tax on travel in India. The region with a tourism-based economy has suffered heavily due to the Corona epidemic. The tourism sector hoped that with relief from the government in Budget 2021, the outbreak of the epidemic could be overcome.