No reduction in funds for asset creation, effective capex to increase by 18%: FM

THE government has not reduced the allocation to capital expenditure, but instead has increased the effective capital expenditure by about 18% from ₹13.18 lakh in the current fiscal to ₹15.48 lakh crore in FY26, which is 4.3% of GDP, finance minister Nirmal Sitharaman said in parliament on Tuesday.

- DIPAK MONDAL @ New Delhi

She was replying to the debate on Budget 2025 in Lok Sabha. Addressing the concern raised by many members over the shift in focus away from capex, the minister reiterated that capital outlay has not come down at all.

The finance minister also said that while the effective capital expenditure in FY26 is 4.3% of the GDP, 10 basis points lower than the budgeted fiscal deficit of 4.4%.