The Centre will continue to focus on a capex-led growth strategy to support economic growth as it goes about putting into effect a roadmap for transforming the country into a $5-trillion economy.
This was reflected in the 2023 year-ender for the Department of Economic Affairs in the Finance Ministry released on Wednesday.
Focus areas
While focusing on growth at the macro level, the government will continue to complement it with all-inclusive welfare at the micro level, promoting digital economy and fintech, technology-enabled development, energy transition and climate action and relying on virtuous cycle of investment and growth, it added.
The government has so far undertaken its reform drive with the spirit of inclusiveness of the marginalised and hitherto socio-economically neglected classes in the overall development process.
The Centre has in the last three years increased capital investment outlay substantially. Its capital expenditure has increased from 2.15 per cent of GDP in 2020-21 to 2.7 per cent of GDP in 2022-23.
The capex of CPSEs in 2023-24 stood at ₹4.88-lakh crore as of November 30. This was 66.61 per cent of the Budget Estimate of ₹7.33-lakh crore. At the same stage last fiscal, the capex spend of CPSEs stood at ₹3.97- lakh crore, which is 59.94 per cent of Budget Estimate.
India is now the fastest growing large economy in the world and well on course to close the current fiscal with GDP growth of at least 7 per cent. India’s second quarter GDP growth surprised on the upside at 7.6 per cent, which has been the highest in the world. India’s first quarter GDP growth was 7.8 per cent.
“The success of government’s policies is further reaffirmed and underscored when the international organisations like the World Bank and IMF recognise India as the fastest growing Emerging Market Economy (EME) in the world and applaud the resilient and stable growth India continues to witness”, Finance Ministry said in a statement.
G20 summit
The year 2023 is also significant as India hosted the G20 Presidency from December 1, 2022 to November 30,2023. As many as 43 Heads of Delegations— the largest ever in G20– participated in the final New Delhi Summit in September 2023.
Meanwhile, the Finance Ministry said on Wednesday that government has till date in 2023 raised ₹16,000 crore through issuance of sovereign green bonds (SGBs). In 2023-24, the government has decided to raise ₹20,000 crore through issuance of SGBs.
The Finance Ministry also said that the National Investment and Infrastructure Fund (NIIF) is working with the US International Development Finance Corporation (USDFC) towards setting up of a multi-billion dollar green-transition credit fund.
In 2023, NIIF launched its first bilateral fund, India-Japan Fund (IJF) with Japan Bank for International Cooperation. JBIC and the Central Government are anchor investors of the $600 million IJF. IJF will focus on investing in environmental sustainability and low carbon emission strategies.
INFRA DEFINITION
The Ministry also said that the expert committee headed by Bibek Debroy, Chairman of the EAC to PM, is finalising its recommendations and the final report of the panel is expected by December 31. This panel (constituted in this year’s Budget) was tasked to undertake a comprehensive assessment of the characteristics/parameters defining infrastructure and the financing framework for Amrit Kaal.
Currently, the Harmonised Master List (HML) list includes 37 infrastructure sub sectors under five categories —transport and logistics; energy; water and sanitation; communication and social and commercial infrastructure.
The inclusion of any sector in the HML enables it to avail infrastructure lending at easier terms and external commercial borrowings, access to longer tenor funds from insurance companies and pension funds and be eligible to borrow from India Infrastructure Financing Company Ltd (IIFCL).