What the govt's capex growth does not reveal

The government's capital expenditure has surged sharply in the first five months (April-August) of FY26. It has already spent nearly 39% of the annual outlay of 11.2 trillion, a 43% year-on-year jump.

- BY PAYAL BHATTACHARYA

But a closer look at the numbers tells a more nuanced story. Mint breaks it down:

1 Is the capex growth artificially inflated? The Centre's 43% capex growth in April-August is inflated by several temporary factors. A part of the surge reflects a low base, as spending was restrained in the year-ago period due to elections.

Beyond that, two large allocations have boosted the headline number without creating new assets. Of the ₹4.32 trillion capital expenditure so far, ₹50,000 crore has been transferred to the Food Corp. of India (FCI) and 17,900 crore to the telecom department. Madhavi Arora of Emkay Global notes that the FCI transfer may later be adjusted with subsidies, while most of the telecom allocation is slated for BSNL recapitalization.

2 How much is the real capex growth then?