Centre not driving investment: Capex fell substantially in Q4

Capex fell substantially in March quarter but capital formation in the economy swelled, says the data; none clear on how this happened

The central government’s capital expenditure declined massively but gross fixed capital formation (GFCF) grew about 14 per cent in the fourth quarter (January-March) of 2017-18, giving confusing signals about the sources of investment.

So far, it was widely believed that the government was driving these in the economy. Yet, according to figures issued on Thursday by the Controller General of Accounts, the Centre’s capex contracted 58.4 per cent in the quarter, from the same period a year before. This could well be due to the advancing of expenditure  to the earlier parts of the financial year, due to early presentation of