NEW DELHI: The finance ministry has asked central public sector enterprises (CPSEs) to advance their capital expenditure plans and also ensure the timely release of payments to small and medium enterprises, as part of the government’s efforts aimed at giving a boost to the sagging economy. “They (CPSEs) were impressed upon to adhere to the expenditure plan and accelerate investment activities,” a finance ministry release said on Friday. North Block called heads of Maharatna and Navratna companies to review their expenditure plans on Friday. The meeting was co-chaired by economic affairs secretary Atanu Chakraborty and expenditure secretary GC Murmu and also attended by financial advisors of infrastructure ministries.
In the budget for FY20, the government had provided Rs 5.38 lakh crore for capital expenditure through internal and extra budgetary resources (IBER), which is essentially that by CPSEs. The amount budgeted for this year is less than the Rs 6.12 lakh crore spent via this route last year. India’s economy grew 5% in the first quarter of the current financial year, its slowest in over six years. The slump in sales of automobiles and consumer non-durable goods in August has added to the worry that revival may take a while.
The government has announced several measures to shore up the economy and lift overall business sentiment, including withdrawal of the super-rich surcharge on foreign portfolio investors and additional depreciation benefits for vehicle purchases. Finance minister Nirmala Sitharaman also unveiled a major consolidation exercise in the banking sector that will see 10 state-run lenders merged into four. Heads of state-owned enterprises were also asked to focus on “monitoring release of payments” for procurement and other contracts without delay to ensure liquidity in a timebound manner.
“Resolution of outstanding payments, which may have been held up on account of disputes, was also reviewed,” the statement said, adding that the ministry of finance would constantly monitor the progress of large infrastructure projects for ministries as well as CPSEs and follow-up meetings would be held.
After the meeting, ONGC executive director NC Pandey said as many as 27 projects worth Rs 87,000 crore are on stream. These will be completed in three-four years, he told reporters. “We are on track. We are hopeful that these projects will be completed on time,” he said.
On payments, it was emphasised that efforts should be made to facilitate these ahead of schedule, Pandey said. Those who attended included top executives of Power Grid Corp. of India, NTPC, NHAI, Steel Authority of IndiaNSE 1.69 % Ltd and Government e-Marketplace.