At 23% spend, Andhra leads laggards in state capex in FY23; K'tka, Bihar cross 100%

Most large states have fallen behind their budgeted capex targets by a wide margin in FY23, which was pegged at Rs 7.4 lakh crore but could spend only Rs 5.71 lakh crore or 76.2 per cent only, according to an analysis. Only four states -- Karnataka, Sikkim, Arunachal and Bihar -- have over-achieved their targets, while Jharkhand and Madhya Pradesh's capex spending stood at 98 per cent each. Eleven states fared better with 80 per cent target achievements, as per the analysis by Bank of Baroda economists. As against this, in FY21, the underachievement level was a high 72 per cent, primarily due to the pandemic emergency spending, and had improved to 95 per cent in FY22. Surprisingly, none of the 25 states whose data are available has been able to achieve the target by even three-fourths as the peak success rate is only 72.4 per cent, according to the analysis. This is surprising as the Centre had disbursed the required amounts for the year.

The poor show was led by Andhra, which could spend only 23.1 per cent or Rs 6,917 crore of the Rs 29,917 crore budgeted for the past fiscal; followed by Haryana, which spent only 48.1 per cent or Rs 10,604 crore of the Rs 22,047 crore, and Rajasthan managed to cross the halfway mark (50.2 per cent) or 19,650 crore of the Rs 39,148 crore. Tripura could spend only 41.3 per cent or Rs 2,185 crore of the Rs budgeted Rs 5,285 crore, and Nagaland spent 47.7 per cent or Rs 7,936 crore of the Rs 16,650 crore, the analysis showed. On the other hand, Maharashtra leads the pack with a 72.4 per cent target achievement, with Rs 60,499 crore being put to use from the Rs 83,530 crore budgeted for FY23. Surprisingly, Kerala, which is a traditional laggard, comes to the second slot, achieving 69.4 per cent of the budgeted capex of Rs 19,330 crore, spending Rs 13,407 crore; and Uttar Pradesh comes third with 69 per cent or Rs 93,555 crore of the Rs 1,35,677 crore.

Uttarakhand is a close fourth with 68.4 per cent of the Rs 11,987 crore; Meghalaya at the fifth slot (67.8 per cent of the Rs 3,233 crore), Bengal next with 67.6 per cent of the Rs 33,144 crore; Assam (64.5 per cent of the Rs 24,064 crore); Punjab (61.1 per cent of the 10,930 crore); Telangana (59.6 per cent of the Rs 29,064 crore). Maharashtra and Uttar Pradesh alone, with Rs 2.19 lakh crore budgeted capex, contribute 29.2 per cent of the total but fared poorly, thus bringing down the all-states average to 70 per cent or thereabout, according to the analysis.

On the contrary, according to the report, the Centre has met its targets in terms of actual capex in various areas and loan disbursals to the states.
Punjab and Andhra -- the two states that top the freebies list -- also exceeded their deficits too. Normally, states tend to wait for the fourth quarter to push projects and investments to assess their fiscal balances and therefore, fail to identify enough projects in such a short period, leading to target missing.