Infra outlays: Key expectations from the Union Budget allocations

l The CMIE data also points to a worrying 57.1 per cent year-on-year decline in the value of government projects completed and a 40 per cent decline in that of the private sector

To fully grasp the importance of infrastructure outlays in the Union Budget allocations, it is important to understand three fundamental public expenditure tenets.

 

One, during a post-Budget interaction in February 2023, a senior finance ministry official revealed on national television that the government had confidential data indicating that every Rs 1 spent on infrastructure contributed Rs 3 to gross domestic product (GDP), whereas Rs 1 spent on any form of direct benefit transfer (DBT) added only 90 paise to GDP. Thus, the case for large dollops of public expenditure on infra capex to pump-prime the economy must continue to be