Akhilesh govt on poll announcement spree; capex to fall 25% in FY18

UP CM has been on an overdrive to inaugurate flagship projects to beat the model code of conduct

Uttar Pradesh government has estimated dip of over 25% in capital expenditure (capex) by different departments during the next financial year 2017-18.

Against the projected capex of about Rs 71,877 crore during the current fiscal, as estimated in Annual Budget 2016-17, the projection for the next fiscal is pegged at Rs 52,840 crore, a fall of 26.48%.

This shows that the incumbent Akhilesh Yadav government had put more emphasis on liberal capex to provide ample funds for the various infrastructure projects underway in the crucial election year (2016-17).

Even as the Election Commission (EC) is likely to announce dates for the 2017 UP polls shortly, state chief minister Akhilesh Yadav has been on an overdrive to inaugurate his flagship infrastructure and development projects all over the state to beat the model code of conduct that would come into play once election dates are announced.

In fact, he has either inaugurated or laid foundation of development and infrastructure projects amounting to over Rs 1,00,000 crore over the last few weeks. These include Agra-Lucknow Expressway, Lucknow Metro, IT City etc. Yadav has candidly admitted that time was running out and he was making sure that most projects were launched.

However, some of the flagship projects were supported with separate budgetary grants under different heads.

Earlier in the day, Yadav - in the state legislative assembly - had tabled interim budget for the next financial year that estimated the total size of Annual Budget 2017-18 at Rs 3,63,744 crore against Rs 3,46,934 crore for 2016-17 in the last Annual Budget tabled in the state assembly on February 12, 2016.

This included Rs 2,87,566 crore of revenue expenditure, which forms the bulk of the budget apart from capital expenditure and other heads viz. Rs 21,905 in interest payment etc.

However, since elections are due in the early months of 2017, the Akhilesh government has sought 'vote on account' of Rs 1,34,845 crore for the first five months (Apr-Aug) of 2016-17.

A state government normally seeks 'vote on account' when elections are round the corner. In the absence of full budget, 'vote on account' ensures sufficient finances at the disposal of the incumbent regime to run administration and incur expenditure under important heads for the stipulated duration.

Meanwhile, Yadav also presented supplementary budget of about Rs 1,683 crore for 2016-17. This would provide additional funds to the state government apart from the budgetary grants already approved by the state assembly earlier for the current fiscal.