Govt asks PSUs to clear vendor dues by Oct 15 to boost spending, growth

The government on Saturday set October 15 as the deadline for central PSUs to clear overdue payments to vendors and contractors as it looks to lift economic growth from six-year low by boosting expenditure.

Finance Minister Nirmala Sitharaman, who reviewed capital spending programmes with heads of central public sector enterprises, said state-owned companies have also been asked to set up a portal by October 15 where service providers, vendors and contractors can track bills and payments so that liquidity crunch is mitigated.

Also, public sector undertakings (PSUs) have been asked to detail lifespan of arbitrations that lock payments after disputes with vendors and contractors, she said, adding the state-owned firms have also been asked to submit spending plans for the next four quarters.

Finance Secretary Rajiv Kumar said 34 central PSUs have already spent Rs 48,077 crore till August and have detailed spending of another Rs 50,159 crore till December 2019. Another Rs 54,700 crore would be spent in the January-March quarter.

Expenditure Secretary Girish Chandra Murmu said capex of all the 242-odd PSUs will be over Rs 4 trillion.