India's Finance Minister expects state government investments to start rolling from April

Finance Minister Nirmala Sitharaman on Thursday said that she expects the state capex to move up starting April 2023, as proposals for projects are expected to come in and the funds can be released straight away. She stressed that capex was important to keep the economy moving.

Addressing the FICCI National Executive Committee Meeting, Sitharaman said, "So, my strong belief is in the month of April itself, there should be a substantial number of proposals coming from many states. So the release can happen straight away."

"And actually this year, we have been talking through the officials with the chief secretaries of the state governments to say that this moves fast and moves early."

The Budget 2023 unveiled proposed a record high 33 percent increase in capital expenditure amounting to Rs 10 lakh crore, which is 3.3 percent of India’s GDP. The increase in capex is aimed at improving the country’s road, rail, port and airport infrastructure and making India a more attractive investment destination.

Sitharaman also highlighted the government's stance on putting the industry at the forefront of policy-making in order to effectively expedite its plans. She said the industry must come up with a clear picture of its needs and strengths and that the "ball is always in the industry's court".

The minister added, by doing so, the government can better support the industry and promote economic growth. This approach is in line with the government's aim to make the industry the prime mover in driving the economy forward.

"Industry should look into itself for its potential and then come up with what the government should do. I would want the industry to be the prime mover in the latest fronts such as renewable energy."

Additionally, Sitharaman spoke on the government's efforts to monitor the implementation and spending of allocated funds every quarter. She emphasised that the "sweat and toil" of the Finance Ministry begins after the laying of the budget and that no department would be found lacking in its performance.

She said that Prime Minister Narendra Modi is directly monitoring the implementation of projects to ensure their success.

In addition, the minister spoke about the importance of paying MSMEs their dues within 45 days if they have delivered. She acknowledged the current recovery pangs faced by the country and stressed the need to support MSMEs and keep the economy moving.