States spent only 76.2% of budget capex targets in FY23 against 95% in FY22: BoB analysis

Most large states have fallen behind their budgeted capex targets by a wide margin in FY23. States were allocated Rs 7.4 lakh crore but could spend only Rs 5.71 lakh crore or 76.2 percent, according to an analysis by Bank of Baroda economists. As against this, in FY21, the underachievement level was a high 72 percent, primarily due to the pandemic emergency spending, and had improved to 95 percent in FY22.

Only four states, Karnataka, Sikkim, Arunachal and Bihar, over-achieved their targets, while Jharkhand and Madhya Pradesh's capex spending stood at 98 percent each.

The poor show was led by Andhra Pradesh, which could spend only 23.1 percent of the Rs 29,917 crore budget target for FY23, followed by Haryana with 48.1 percent of the Rs 22,047 crore, and Rajasthan managed to cross the halfway mark (50.2 percent) of the Rs 39,148 crore.

This is dismal as the Centre government had met its obligations in terms of loans disbursed to the states for capex. It also met its fiscal deficit target, the report stated.

Tripura could spend only 41.3 percent of Rs 5,285 crore and Nagaland spent 47.7 percent of the Rs 16,650 crore, the analysis showed.

Maharashtra, which spent 72.4 percent of Rs 60,499 crore, and Uttar Pradesh, which spent 69 percent of Rs 1,35,677 crore, fared poorly, thus bringing down the all-state average to 70 percent or thereabout, according to the analysis. The two states got a combined budget capex of Rs 2.19 lakh crore, which was 29.2 percent of the total capex of 25 states for which data is available.

Surprisingly, Kerala, which is a traditional laggard, achieved 69.4 percent of the budget capex of Rs 19,330 crore and Uttar Pradesh spent 69 percent of Rs 1,35,677 crore. Uttarakhand spent 68.4 percent of the Rs 11,987 crore. Meghalaya spent 67.8 percent of Rs 3,233 crore, and Bengal spent 67.6 percent of Rs 33,144 crore, Assam spent 64.5 percent of Rs 24,064 crore, Punjab spent 61.1 percent of Rs 10,930 crore and Telangana spent 59.6 percent of Rs 29,064 crore.