NEW DELHI, 27th June, 2023 (WAM) – Infrastructure investment in Indian states will receive a shot in the arm with the Central government’s decision yesterday to sanction proposals worth 564.15 billion rupees ($6.88 billion) for this purpose.
The money will be spent in capital investment in the health, education, irrigation, water supply, power, roads, bridges and railways sectors, the Finance Ministry here announced.
The money will be disbursed in 50-year interest-free loans to states and will boost spending across the country. The federal government’s budget has provision for spending a further tranche of an equal amount in states during the current financial year, which ends on March 31, 2024.
This “Special Assistance to States for Capital Investment” was launched in the financial year 2020-21 in wake of the COVID-19 pandemic to give a boost to capital spending by states. The scheme has since been extended.
In the last financial year, one trillion rupees ($12 billion) was sanctioned under this scheme. Almost the entire money was disbursed, according to the Finance Ministry announcement.
About one-sixth of the current financial year’s sanction will go to Bihar state, followed by Madhya Pradesh, West Bengal and Rajasthan.
WAM/Krishnan Nayar