No hike in Budget, but road and rail still among govt’s top capex drivers

While both ministries got the same capex allocation as in last year’s Budget, they still account for around 48 per cent of the total capex allocation across ministries.

According to the Budget document, the total estimated expenditure of the Central government for FY 2025-26 is Rs 50.65 lakh crore. Of this, the allocation for capital expenditure is Rs 11.21 lakh crore, or 22.13 per cent of total expenditure.

Capital expenditure goes towards building assets that have long-term benefits and can potentially generate revenue. Revenue expenditure, on the other hand, refers to expenses incurred in maintaining daily operations and includes salaries, wages, rent, office expenses, and so on.

The Road Transport Ministry and Railways got allocations of Rs 2.72 lakh crore and Rs 2.65 lakh crore respectively in FY2024-25, too.

In FY2024, Railways incurred a total capital expenditure of Rs 2.42 lakh crore, up from Rs 1.59 lakh crore in FY23 and Rs 1.17 lakh crore in FY22.

As for the Ministry of Road Transport and Highways, its total capital expenditure in FY24 was Rs 2.63 lakh crore, up from Rs 2.05 lakh crore in FY23 and Rs 1.13 lakh crore in FY22.

According to the economic survey, released a day before the Budget, until November 2024, Defence, Railways and Road Transport accounted for about 75 per cent of capital expenditure, whereas significant Year-on-Year growth occurred in Power and Food and Public Distribution sectors.

The survey also noted that the pace of the Union government’s capital expenditure in major infrastructure sectors was affected during the first quarter of FY25, largely due to the Model Code of Conduct that had been in place for the general elections.

However, capital expenditure saw an uptick in July-November, 2024. On average, ministries linked to infrastructure sectors, including Railways and Roads, utilised around 60 per cent of the budgeted capex during April-November, 2024.

The Railways Ministry said given the higher public spending on capital expenditure, the country can expect 200 new Vande Bharat trains, 100 Amrit Bharat trains, 50 Namo Bharat rapid rail services and 17,500 general non AC coaches in the next two to three years.

“Focusing on safety, the Budget allocates `1,16,000 crore rupees for expenditure this year to augment the safety of Indian Railways through various projects,” said Ashwini Vaishnaw, Minister for Railways.

For the Road Transport Ministry, key capex projects include the Bharatmala Pariyojana, Char Dham Mahamarg, National High-Speed Corridors, national highways wider than four lanes, advanced traffic management systems, and multi-modal logistics parks. “This Budget will have a big impact on road infrastructure… It emphasises reforms, youth leadership, inclusion and investment. It (also) emphasises community participation, women empowerment and centre-state collaboration to drive holistic development,” said Nitin Gadkari, Minister of Road Transport and Highways.