Centre’s entire borrowing in FY25-26 to be dedicated to capital expenditure
Hailing the Budget, Finance and Revenue Secretary, Tuhin Kanta Pandey said it prioritised non-inflationary growth through careful fiscal management.
He added the Centre’s entire borrowing of Rs 15.68 lakh crore in 2025-26 would be channelled exclusively into capital expenditure. The capital expenditure programme of Rs 15.48 lakh crores for the fiscal year 2025-26 includes Rs 11.21 lakh crore in direct Union Government spending and Rs 4.27 lakh crore in grants to states for capital projects. This approach marks a significant shift from traditional patterns where government borrowing often funded revenue expenditure.
Pandey emphasised the Budget’s design ensured growth without stoking inflation pressures. “When we show the numbers, there is nothing hidden elsewhere. Our entire borrowings are going into capex — nothing could be better than this. It’s a non-inflationary budget,” he said while addressing industrialists at a FICCI conference in New Delhi.
The government has exceeded its fiscal consolidation targets, achieving a deficit of 4.8 per cent against the projected 4.9 per cent for the current year, with plans to reduce it further to 4.4 per cent in the upcoming fiscal year.
The Budget tries to balance the impending challenges focusing on demand and supply side imperatives. The stimulus offered will push growth while fostering macro-economic stability, Pandey noted.
Overall, the theme of the budget has been growth with fairness, trust first, give stimulus to economy and to inculcate and encourage entrepreneurship, he concluded.
According to Tuhin, while much has been done to accelerate the pace of reforms, there is much more that is needed in terms of addressing the unfinished reforms agenda. He also encouraged industry to boost investments.
