Rs 1,900 crore deficit likely to hit infrastructure projects in FY23

The Parliamentary Standing Committee on Commerce has observed that a massive shortfall in the budgetary allocation of over Rs 1,900 crore by the finance ministry to the industry department may have an adverse impact on the implementation of infrastructure (infra) projects in 2022-23 (FY23).

While the Department for Promotion of Industry and Internal Trade (DPIIT) had sought Rs 10,267 crore from the finance ministry for FY23, it received Rs 8,348-crore allocation.

For the National Industrial Corridor Development & Implementation Trust (NICDIT), the finance ministry has allocated Rs 1,500 crore instead of Rs 2,400 crore demanded for the project.

“The committee notes with concern that there is a massive shortfall of Rs 1,919 crore, which could have an adverse impact on infra projects and schemes envisaged for FY23. The committee, therefore, recommends the department to closely monitor these schemes and, if required, engage the Ministry of Finance for additional allocation to ensure smooth implementation of schemes and projects,” it said in its latest report submitted before Parliament during the just-concluded Budget session.

The Centre is developing various industrial corridor projects as part of the national industrial corridor programme aimed at developing greenfield industrial cities in India to compete with the best manufacturing and investment destinations in the world.

NICDIT has been constituted for unified development of industrial corridors in the country. Delhi-Mumbai Industrial Corridor is the first industrial corridor being implemented through four industrial nodes, such as Dholera Industrial City, Gujarat; Shendra-Bidkin Industrial Area, Maharashtra; Integrated Industrial Township, Greater Noida, Uttar Pradesh; and Vikram Udyogpuri Integrated Industrial Township, Ujjain, Madhya Pradesh.

The committee noted ‘with concern’ the tardy progress of the NICDIT, reflected in the slow pace in the utilisation of allocation.

“The committee opines that timely implementation of flagship projects, such as industrial corridors, are crucial to the overall economic development of our economy. The committee recommends the department ensure timely resolution of issues and proactively engage with the states concerned, so that progress of projects and utilisation of funds are not stalled in future,” it added.  

The committee lauded DPIIT for the high utilisation rate of nearly 100 per cent of the budget allocated between 2018-19 and 2020-21.

It, however, observed that it has been able to utilise only 86.52 per cent of the budgetary allocation in the Revised Estimates for 2021-22 until the time of preparation of the report.

“The committee is hopeful that there would be full utilisation of the allocation and recommends the department take concerted efforts to ensure optimum utilisation of the allocation before the end of this fiscal year,” it added.