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In anticipation of the Interim Budget 2024, a specific focus lies on potential enhancements in the Infrastructure sector. Since it is an Interim Budget, It is likely to provide an outline of anticipated developments after the upcoming 2024 election.
The upcoming interim budget is likely to see a higher capital expenditure on Infrastructure, in line with the past three years focusing on green investment. To meet the aspiration of gross capital formation on infrastructure to be 8-9% of GDP, the government might continue to maximize public expenditure on infrastructure, both core and social
The government’s capital spending has tripled in the last five years, spurring infrastructure creation. It resulted in a wider network of roads and more airports to help economic activity.
The PM GatiShakti plan will remain in focus. The government has evaluated more than 300 central and state projects worth 11.58 crore in two years since the launch of this plan for multi-modal connectivity. While it is expected that the government will spend more on infrastructure, a major chunk may likely be going on roads and railways.
Analysts feel that the market risks and the willingness of banks to fund infrastructure projects are the challenges ahead. Given the current global developments, India being at an important stage of growth, the government is expected to continue to lay major thrust on public capex(physical, social, digital infrastructure) in the forthcoming budget
In the past few year’s budget, we see the government has substantially increased its budget allocation YoY. The Government allocated 10 lakh crore in the 2023-24 financial budget, 7.5 lakh crore in the 2022-23 financial budget, and 5.54 lakh crore in the 2021-22 financial budget. India aspires to become a 5 trillion dollar economy by 2025.