labels: economy - general
Govt may increase public expenditurenews
Alok Agarwal
03 October 2001


Mumbai:
Keen to boost a sagging economy, the Indian government is contemplating an additional expenditure of Rs 10,000 crore in various projects - like the railways, irrigation, power and highways - as identified by the committee of secretaries headed by Cabinet Secretary T R Prasad.

Disturbed by the fact that the economy grew only 4.4 per cent of the GDP in the first quarter of the current fiscal in comparison to the 6.1 per cent in the corresponding period last year, the government has been contemplating various measures in order to turn the trend at least by the last quarter of the current fiscal.

If this investment goes through it would be in addition to Rs 58, 000 crore, which ministries of power, petroleum, roads and the railways are likely to invest in various projects in their sectors.

Sources said Rs 11,000 crore each was already lying with the railways and power, Rs 17,000 crore with petroleum and Rs 8,500 crore with roads. These amounts are already lying with the ministries, having been allocated during the budgetary exercise. The general feeling is that if these investments do go through, then their impact could be felt by the last quarter of the current year.

The committee has suggested that only those projects, which are 70 per cent complete, should be taken up for investments as it would be worthwhile putting in the extra money in them and complete them in the current fiscal itself. It makes sense, therefore, that those sectors like power, road, petroleum and the railways have been identified for an additional investment because a number of projects here would meet the 70-per cent completion mark.

The sources said the railways have about 12 projects, which are 70 per cent complete, and the power ministry is keen on completing the Naphtha Jhakri Hydel project before its prescheduled time, which is financial year 2003.

As an additional measure, the government is also contemplating giving early clearances to projects to cut out on implementation delays. It is also mulling over whether to raise the threshold investment limits for individual ministries to speed up decision-making and to empower them to award contracts and take investment decisions after taking advice of financial experts.

 


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Govt may increase public expenditure