Capex outlay in Budget to be force multiplier for Viksit Bharat: FM

Sitharaman said since the FY27 Budget was the first Budget in the second quarter of the 21st Century, there has been some investments which will have bearing on the long term

Finance Minister Nirmala Sitharaman on Wednesday said the allocation of ₹17 trillion towards capital expenditure (capex) will work as a force multiplier and accelerate the Centre’s move towards Viksit Bharat.

 

“Government’s strategy to achieve Viksit Bharat is to provide capital investment in the economy. For that purpose, we have allocated effectively ₹17.15 trillion. This will work as a force multiplier and therefore accelerate our move towards Viksit Bharat,” Sitharaman said while replying in the Lok Sabha to the general discussion on the Union Budget FY27.  

 

While the government has allocated ₹12.22 trillion as capex in FY27, the effective capex including capital-linked transfers to states and central public sector enterprises comes to ₹17.15 trillion, amounting to 4.4 per cent of gross domestic product (GDP).

 

On the government’s continuous focus on building infrastructure, Sitharaman said the Centre is focussing on not just national highways, but also on waterways so that the cost of logistics in this country can come down. “States which are very much in the hinterland not connected to any seaport will have the advantage of moving goods much faster at a lesser cost,” she added.

 

Sitharaman said since the FY27 Budget was the first Budget in the second quarter of the 21st Century, there have been some investments which will have a bearing in the long term.

 

 “The bio-pharma Shakti, where we are highlighting how biosimilars will be an answer to the life-threatening diseases that take a long time to evolve. You invest today, biosimilars arrive in several years. But India should have a lead in that and therefore in this Budget we have provided for research in biopharma and making sure that we will be leaders in biologics and biosimilars,” she said. The FM added that the same spirit guided the government when it announced the India Semiconductor Mission 2.0.

 

Highlighting the scheme for carbon capture utilisation and storage technologies, the finance minister said it is a very important means through which 2070 net-zero goal can be achieved. “Even as the strategy, the technology and the ways to do it are all evolving, we have invested in it so that we can be a leader in that,” she said.  

 

 On the government’s push for labour-intensive sectors, Sitharaman said the objective is not only to strengthen them with more resources but also revive legacy industries that have long awaited rejuvenation and are now being funded.

 

Citing the Budget announcement of champion micro, small and medium industries (MSMEs), the finance minister said the government will support medium-sized industries which have the potential to grow, export and also become champions in their sectors. 

 

“I have announced several steps towards equity help, professional help and also making sure that they will have liquidity access and participate in India’s growth,” she added.

 

Speaking about the five regional medical hubs intended to promote India as a centre for medical tourism — where all aspects of medical education and patient treatment can be brought together — Sitharaman said she has not named any state for this. 

 

And, states can aspire to host these hubs by meeting the PM Gati Shakti criteria.

 

Responding to issues raised by Member of Parliament NK Premachandran on the Centre moving to debt-to-GDP ratio as the fiscal anchor without amending the FRBM Act, Sitharaman said it is not a new target.

 

 “Along with the fiscal deficit, debt-to-GDP is already included as a target through the amendment of the FRBM Act in 2018,” she added.