Capital investment proposals of Rs 56,415 cr approved

In order to boost capital spending by states, the Centre has approved capital investment proposals of Rs 56,415 crore for 16 states, in the current financial year.

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The Centre has approved the grant of interest-free and long-term capital expenditure loans to sixteen states, aimed at boosting capital spending by states.

Under the ‘Special Assistance to States for Capital Investment 2023-24’ scheme, announced in the Union Budget 2023-24, the Ministry of Finance has approved capital investment proposals of Rs 56,415 crore for 16 states. In the previous financial year, an amount of Rs 81,195 crore was released to the states.

The scheme provides special assistance to the states in the form of a 50-year interest-free loan up to an aggregate sum of Rs 1.3 lakh crore during the financial year 2023-24. 

The maximum amount has been allocated to Bihar (Rs 9,640 crore), followed by Madhya Pradesh (Rs 7,850 crore) and West Bengal (Rs 7,523 crore). The states of Rajasthan and Odisha have been allocated an amount of Rs 6,026 crore, and Rs 4,528 crore respectively. 

In its statement, the Finance Ministry said, “Capital investment projects in diverse sectors have been approved including health, education, irrigation, water supply, power, roads, bridges and railways. Funds for meeting the State share of Jal Jeevan Mission and Pradhan Mantri Gram Sadak Yojana have also been provided to the States under this scheme to enhance the pace of the projects in these sectors.” 

The scheme for financial assistance to states for capital investment/expenditure was first introduced by the Ministry of Finance during the Covid-19 pandemic in 2020-21.