Covid-19 impact: Govt capital expenditure declines 41% in September

Result of labour unavailability and high base, say experts

Hit hard on the revenue front by the pandemic-induced economic slowdown, the government put a squeeze on capital expenditure, which declined 39 per cent in the second quarter (Q2).

Experts have now cast doubts over the government’s ability to meet its budgeted target for capex this fiscal year, even though the finance ministry recently announced additional spending of Rs 25,000 crore.

The capex decline in the first half of FY21 was 27 per cent. A backward calculation suggests that capex declined by 41 per cent in September, after a 21 per cent contraction in August. 

Experts say this was because of factors like