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Monday, December 23, 2024 | 05:09 PM ISTEN Hindi

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Capex measures to deliver the goods rather than the consumption booster

States and centre would be spending more on projects like roads, urban development, defence as a result of Finance Minister's announcements.

Madan Sabnavis, chief economist, CARE Ratings (Photo: PHOTO CREDIT: Kamlesh Pednekar)
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Madan Sabnavis, chief economist, CARE Ratings (Photo: PHOTO CREDIT: Kamlesh Pednekar)

Madan Sabnavis
The fiscal announcements made by the Finance Minister (FM) on Monday are a combination of frontloading of consumption expenditure with some affirmative capex spending by both the central and state governments. The techniques being used for the two objectives are quite different, thus having a diluted impact on the fiscal balances. Overall the impact will be positive, though the extent will be limited.

The more aggressive move is on the capex where the states and centre would be spending more on projects that have been outlined in specific areas like roads, urban development, defence and water supply. States have been

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