Revenue expenditure to exceed budgeted value in FY24: CareEdge

Sustained Capex Focus: The Capex-to-total expenditure ratio is expected to inch up marginally to around 23 per cent in FY25, the credit rating agency CareEdge said in its Pre-Budget Survey and Expectations document. “We expect the government to stick to its capex target of Rs 10 trillion in FY24 and raise it further by ~10 per cent to Rs 11 trillion in FY25,” CareEdge in its pre-budget memorandum said.

The government has been focusing on public infrastructure to drive capex growth, and analysts are expecting the government to push the pedal on Capex to drive India’s economic growth. 

Revex to Exceed Budgeted Value in FY24

While the analysts and experts believe that the government will not face any challenge in meeting its capital expenditure target of Rs 10 trillion. According to CareEdge, the government is expected to meet its capital expenditure target of Rs 10 trillion. However, the challenge is to meet the revenue expenditure target.  

“We project some slippages in the revenue expenditure to the tune of about Rs 734 billion,” the CareEdge stated. 

According to the CareEdge document, on December 6, 2023, the central government approved the first supplementary demand for grants, amounting to Rs 1.29 trillion. Taking into consideration the savings from another scheme worth Rs 709 billion, the net additional outlay would be Rs 584 billion. 

“The additional funds were directed towards food subsidies, fuel subsidies, fertilizer subsidies, and Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). Given that the actual expenditure on the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) has already surpassed the budgeted allocation, and with persistent high subsidy spending, particularly on fertilizers, we anticipate an additional requirement of funds for expenditure,” the survey added further.