NEW DELHI: Nearly 20% of the amount allocated for special assistance to states for capital expenditure remained unspent in FY23, finance ministry documents show. According to the Department of Expenditure, Ministry of Finance, the states availed of Rs 81,195 crore in 50-year interest-free loans for infrastructure spending.
Out of the Rs 81,000 crore, Rs 15,383.85 crore was given to the states as an incentive for meeting reforms prescribed by the Central government for availing the interest-free loan. The central government implemented the ‘Scheme for Special Assistance to States for Capital Investment’ in 2022-23 with an outlay of Rs 1 lakh crore. Out of the total allocation, Rs 80,000 crore were meant to be allocated to states in proportion to their share of tax devolution.
The rest of the amount was available to states based on meeting certain reform criteria. These reforms like digitization, laying optical fibre cables, urban reforms, scrapping of old vehicles, disinvestment of state PSUs, etc. The Centre has allocated Rs 1.3 lakh crore for the scheme in 2023-24. The states have lagged behind in FY23 when it comes to their spending on infrastructure and other asset creation.
According to an India Ratings report, the provisional data for 26 states from the Comptroller and Auditor General showed 26 states in aggregate have achieved 52% of the FY23 budgeted capex during April-January FY23.