Capex by Road Ministry in August rises nearly 42% MoM
The ministry spent Rs 32,438.42 crore till August, up from Rs 22,853 crore in July. Last year, the ministry had spent Rs 27,936.26 crore in the same period
October 01, 2020 / 05:20 PM IST
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With the government laying emphasis on ramping up capital expenditure to boost a sagging economy, data from the Controller General of Accounts (CAG) show that the Ministry of Road Transport and Highways is progressing on the right track as there has been a nearly 42 percent month-on-month rise in capital expenditure in August.
The ministry spent Rs 32,438.42 crore till August, up from Rs 22,853 crore in July. Last year, the ministry had spent Rs 27,936.26 crore in the same period.
The budgetary allocation for current year is Rs 81,974.71 crore versus Rs 72,058. 58 crore last year.
The government is looking at various ways to ensure road projects don’t fall prey to economic uncertainty. It is reportedly working on a new formula to reduce risks in road construction projects and safeguard the interests of banks.
The highway and road construction projects offer employment opportunities to the informal workforce and a pickup in those activities will help them recover from the coronavirus-induced setback.
According to CAG data, capex in Railways picked up in August with the national transporter spending Rs 25,541.44 crore compared to Rs 23,308.74 crore in July – an increase of 9.5 percent. Last year, the Railways spent Rs 27,172 crore till August.
In good news for the Railways, freight revenue is also expected to recover in the next four to six months, according to a study by Praxis Global Alliance and Zetwerk. Freight earnings saw a decline of 17 percent at Rs 50,168 crore during the first half of the current fiscal.
Freight loading has been on a steady growth path with 15 percent growth in September compared to the previous year.Follow our coverage of the coronavirus crisis here