INSUBCONTINENT EXCLUSIVE:
States have contributed 37-40 per cent of the total infrastructure investment in the country.The state governments' actual capital
revenue collections, credit ratings agency ICRA said in a research report
States have cumulatively budgeted a lower capital outlay of Rs 5.7 lakh crore for infrastructure spending in the current financial year,
contributed 37-40 per cent of the total infrastructure investment in the country
Out of the infrastructure investments worth Rs 111 lakh crore planned under the National Infrastructure Pipeline (NIP), about 40 per cent is
from the state governments, according to ICRA.Few larger states have put a greater focus on infrastructural development with the emphasis
activities, states are looking at a decline in their own revenue
The tax revenues of states in 2020-21 could be sharply lower than budgeted due to curtailed consumption.In order to bridge the shortage, the
unconditional borrowing limit for states has been raised from 3 per cent of gross state domestic product (GSDP) to 4 per cent of GSDP for
States also have the option of availing another 1 per cent of the GSDP on completing specified reforms
Even then, there is likely to be a shortfall, part of which can be bridged by the additional loans from the Centre due to GST
compensation.For supporting capex, the Central government had also announced a special interest-free 50-year loan to states for capital
2020-21, depending upon the extent of the borrowings availed and the reforms completed.The cutdown of the capex will have an adverse impact
on the construction companies, which depend on state government projects
While new project investments could decline in 2020-21, the bill realisation for the ongoing projects could also get delayed, which may
impact the execution of these projects.
