CPSE Capital Expenditure in FY25 Surpasses Target by 103%: A Remarkable Financial Achievement!

In a remarkable turn of events, central public sector enterprises (CPSEs) and various state-run organizations, including the National Highways Authority of India (NHAI) and the Indian Railways, have outperformed their capital expenditure (capex) goals for the fiscal year 2024-25. With an impressive investment of ₹8.1 lakh crore, these agencies have not only met but exceeded their targets by 103%, showcasing robust growth in public sector investments.

Robust Investments by NHAI and Railways

The surge in investments from the NHAI and Indian Railways has significantly contributed to this achievement. Over the past few years, both entities have relied heavily on budget allocations to fuel their capital projects. Together, they represented a substantial 55% of the overall capex target set for CPSEs in FY25.

NHAI has outdone its annual goal of ₹1.69 lakh crore.
Indian Railways is on the brink of meeting its target of ₹2.6 lakh crore.

ONGC’s Remarkable Surge

Another standout player in this investment landscape is the Oil and Natural Gas Corporation (ONGC), which recorded a staggering 184% increase in investments, reaching ₹77,926 crore in the first ten months of FY25. This remarkable growth illustrates the crucial role that energy sector investments play in the broader economic revival.

Overall Capital Expenditure Landscape

Across all CPSEs and agencies with annual capex targets exceeding ₹100 crore, a collective goal of ₹7.87 lakh crore has been set for FY25. However, the public capex growth has experienced a slowdown due to multiple factors, including the general elections and prolonged monsoon rains that have impacted project timelines.

Impact of Economic Conditions

Despite the slowdown observed until December of the current financial year, there are signs of recovery in the capital expenditure landscape.

The Centre’s capex only edged up by 0.8% during April-February FY25.
State-level capital expenditure has seen a slight improvement, with less than a 1% annual decline, thanks to enhanced capex loans from the Centre.

Other Key Players in Public Sector Investments

Several other CPSEs have also made significant contributions to this investment surge. Noteworthy players include:

Indian Oil Corporation: A major fuel retailer and refiner.
NTPC: A leader in power generation.
Coal India: A crucial player in the coal sector.

In conclusion, while the Centre and states strive for a revival in economic growth through public sector investments, challenges remain. The potential impact of the ongoing elections continues to shape the investment landscape, yet the progress made by CPSEs and their affiliates remains a positive sign for the future.