Centre’s capex slows in February, April to February capex 80% of full year target

The centre’s capital expenditure in the first 11 months of the fiscal came in at just about 80% of the full year with the pace of spending easing in February compared to the previous month.

As per official data released by the Controller General of Accounts on Friday, the Centre’s capital expenditure was Rs 8.11 lakh crore between April 2024 and February 2025, which amounted to 79.7% of the revised target of Rs 10.18 lakh crore. It had spent an almost similar Rs 8.05 lakh crore as capital expenditure in the same period last fiscal.

Significantly, the capital expenditure in February was just Rs 54,528 crore, which was the lowest since December 2024 when the Centre had spent Rs 1.71 lakh crore as capex. In January, the capex was Rs 72,022 crore.

Analysts point out that this would mean that the Centre would have difficulty meeting its full fiscal target for capex this fiscal. The RE was scaled back from the original target of Rs 11.1 lakh crore due to lower spending on account of the general elections and an unusually long monsoon.

Capital expenditure by key infra ministries of railways and roads amounted to 91% of the RE and 90% respectively in the first 11 months of the fiscal.

Aditi Nayar, Chief Economist & Head – Research & Outreach, ICRA noted that the Centre’s capex needs to expand by about 44% YoY to touch Rs 2.1 lakh crore in March 2025 to meet the FY2025 revised estimate, which appears to be a tall ask. “Consequently, we expect modest undershooting in capex relative to the target of Rs. 10.2 lakh crore as per the FY2025 RE. However, this would offset the miss on the disinvestment front, as well as any overshooting in the revex,” she said.

The Centre’s fiscal deficit remained in check at Rs 13.46 lakh crore or 85.8% of the full year target, with expectations that it might do at ad better than the revised estimate of 4.8% of the GDP for the current fiscal.

Nayar said ICRA expects the fiscal deficit to print largely in line with the absolute FY2025 RE of Rs. 15.7 lakh crore. “Interestingly, the NSO has pegged the nominal GDP at Rs. 331.0 trillion as per its Second Advance Estimate (SAE) for FY2025, which is 2.1% higher the First Advance Estimate (FAE) of Rs. 324.1 trillion that was used in the Union Budget,” she said, adding that this implies that the fiscal deficit will be contained at 4.7% of GDP in FY2025, lower than the RE of 4.8% for the fiscal.