April sees capex boost of 48% with second year of advanced budget

New Delhi, May 22: The central government’s capital expenditure (capex) in April 2018 saw a jump of 48 per cent compared with the same month last year, the consequence of a second consecutive year of an advanced budget. The biggest gainers as a result of this capex boost were ministries of defence, railways and road transport.
Senior government sources said that capital expenditure for the first month of 2018-19 was around Rs 430 billion, compared with nearly Rs 290 billion in April 2017. Overall expenditure, however, dropped from Rs 2.42 trillion to Rs 2.31 trillion. “Last April, there were higher arrears from 2016-17 which were carried over. There were more pending payments made for fertilizer and food subsidies compared to April 2018,” said a senior official. Excluding that, our emphasis on front-loading of expenditure has continued,” the person said.
Lower carryovers led to a reduced revenue expenditure outlay for the central government. For April, it was around Rs 1.87 trillion, around Rs 260 billion or 14 per cent lower than Rs 2.13 trillion in April 2017. The official expenditure, revenue, and fiscal deficit data for April 2018 will be released on May 31.
The capital expenditure outlay for Defence Ministry jumped a staggering 127 per cent to Rs 148 billion from Rs 65 billion for the same period last year, sources said. Railways saw a capex increase of Rs 20 billion while Ministry of Road Transport and Highways was allocated Rs 70 billion in capital spending compared to April last year.
The union budget 2017-18 was the first budget to be advanced to February 1 from February 28. This allowed the passage of Finance Bill before April 1, and hence led to higher disbursements by the central government, unlike previous years, when a vote-on-account was used to keep the government running in April-June quarter, and the Finance Bill used to be passed in May.