Finance Minister Nirmala Sitharaman calls for faster cap investment rollout by states

Finance minister Nirmala Sitharaman on Friday asked expenditure secretary Manoj Govil to coordinate with states to expedite the submission and approval of project proposals and ensure that they undertake capital investments in a timely and efficient manner.

Under the scheme for special assistance to states for capital investment, their projects worth only ₹50,069 crore have been approved in the first half of 2024-25, against the budgetary allocation of ₹1.5 lakh crore for the entire year, the finance ministry said in a post on X (formerly Twitter).

Under this scheme, the Centre extends 50-year loans to states at zero interest to boost their durable assets creation. States are required to undertake stipulated reform measures to obtain a part of the capex loans that are conditional in nature, although a large part remains untied.

In a meeting to review the scheme’s progress, Sitharaman also directed senior finance ministry officials to nudge states to carry out the required reforms and use up the entire capex allocation.

This was a part of her series of meetings lined up to review the capital spending and resultant asset creation across ministries. Economic affairs secretary Ajay Seth and other senior finance ministry officials also attended the meeting.