Telangana stands seventh among the top 10 States in terms of expenditure incurred on capital outlay/asset creation (capex) by State governments during 2015-2019.

However, in total capex on irrigation it is ahead of all other States in the country.

According to a study by CARE Ratings, Telangana comes after Uttar Pradesh, Maharashtra, Karnataka, Bihar, Gujarat and Madhya Pradesh on overall capex followed by Tamil Nadu, West Bengal and Odisha.

The top 10 States in the country accounted for 73 per cent of the combined capex undertaken by all States. Telangana’s share in the combined capex has increased by 2 per cent during the period. At the consolidated level, the expenditure was more towards transport, irrigation, flood control, energy, water supply, sanitation and rural development. “Together, these have accounted for over 65 per cent to total expenditure undertaken by States in FY19 (Revised Estimates),’’ the study said.

While Telangana leads in irrigation, Tamil Nadu spent highest on urban development while Bihar focussed on rural development. Uttar Pradesh emerged as one of the largest spenders in the areas of transport, energy, public health, education and housing while Maharashtra incurred highest expenditure on agriculture.

In terms of annual increase, capital expenditure of States in absolute terms at the consolidated level witnessed an increase in case in four our of the last five years. In FY18, it declined by 2 per cent over previous year.

The State Government’s role in undertaking expenditure towards asset creation has become increasingly important in the recent years considering that States’ share accounts for two-third of general government capital expenditure.

It is crucial for States to incur expenditure towards capital projects as it results in enhanced revenue receipts in the future and also has implications on growth and welfare of the economy.

Related Topics
comment COMMENT NOW