The Center’s capital expenditure has reduced by 35 percent on an annual basis in February 2025. According to the latest data of India’s Comptroller and Auditor General, FY 25 incurred 79.9 percent of the total expenditure in April 25 to February, while the revised estimate of this period was 85 percent. Till a month before the financial year 2025, the government is far from the target of capital expenditure of more than Rs 2 lakh crore for this period.
Ecra’s chief economist Aditi Nair said, ‘We are estimated to cost less than Rs 10.2 lakh crore for the revised estimate of the capital expenditure of FY 25. However, this deficiency will make up to increase the revenue expenditure along with the decrease on the disinvestment front.
In the first half of the recent financial year, capital expenditure was affected by the election and the implementation of the code of conduct. Capital expenditure in January had increased by more than 51 percent on an annual basis. The main reason for the increase in this was the capital outlay for transfer and defense spending to the Railways, states. The fiscal deficit of the government was Rs 13.5 lakh crore. This was 86 percent of the revised estimate from April to February of FY 25 and it was less than Rs 15 lakh crore for the last year’s period.
Nair indicated that the higher nominal GDP is Rs 331 lakh crore. According to the second advance estimate of the National Statistics Office, the fiscal deficit of FY 2025 will be within 4.7 percent of the GDP (GDP) and is less than 4.8 percent of the revised estimate of this financial year.
In FY 2025, during April to February, the gross collection increased by 11 percent compared to the previous year. Although the income tax collection increased by 22 percent during this period, the corporate tax collection was only two percent. The total revenue receipts were 81.2 percent of the revised estimate of the period from April to February from April 25, while it was 82 percent in this period last year.
Nair said, “Although the income tax collection needs to increase by 6 percent in March 2025 to achieve the revised estimate of FY 2025, while this month the corporate tax collection needs to grow faster at the rate of 34.4 percent.” In the first 11 months of 2025, the net tax revenue was 78.8 percent in the first 11 months of 2025, while the revised estimate of the financial year 2024 was 79.6 percent.
First Published – March 29, 2025 | 4:55 am IST