New Delhi: At a meeting held on Saturday with Union Minister for Finance Nirmala Sitharaman, Maharatna and Navratna PSUs said that they have plans of making capital expenditure of Rs 50,000 crores in the next quarter. The meeting was held to review PSUs’ capital expenditure till date and plans for the next two quarters of financial year 2019-20.
This meeting was held as part of the series of meetings that the Finance Minister has been having with various stakeholders and the measures that have been taken to accelerate the economic growth rate. It was attended by Finance Secretary Rajeev Kumar, Secretary DEA Atanu Chakraborty, Secretary Expenditure GC Murmu and heads /representatives of 32 Maharatna and Navratna PSUs. The PSUs shared their capital expenditure (Capex) till August 2019 with the Finance Minister and explained their plans for the next two quarters.
So, what’s the capex plan?
ONGC has a capex plan of Rs 3,2921 crores for FY 2019-20. Its capex till August 2019 was Rs 8,777 crores, which was 26.66 percent of the total planned capex. Indian Oil Corporation has a capex plan of Rs 25,083 crores of which 8,173 crores (32 percent) has been spent. NTPC has planned a capex of Rs 8,490 crores (42 percent) out of a plan of Rs 20,000 crores.
Here’s what FM told Maharatna and Navratna PSUs
The Finance Minister stressed that capex needs to be given a vigorous push in the next two quarters. Therefore, a capex plan has to be firmed up and followed up with ground-level execution. The Ministry of Finance would monitor capital expenditure regularly. The minister also told PSUs to ensure that regular payments are cleared expeditiously as it spurs investment cycle. The public sector companies were advised to establish an e-billing portal for enabling stakeholders to track the status of payments. Special efforts must be made to clear dues of MSMEs and resolve cases on the SAMADHAN portal of Department of MSME, Sitharaman said.
Govt wants PSUs to double contribution to GDP
The government has introduced performance-based evaluation and has also empowered the boards of Maharatna and Navratna companies to take operational decisions. The Centre wants PSUs to double their contribution to the gross domestic product (GDP) and be the “third major source” of revenue for the Centre after direct and indirect taxes. PSUs must make efforts to reduce the country’s imports bill and expand India’s global strategic reach by 2022, an official statement said.
The combined capital expenditure by PSUs and Departmental Undertakings (DUs) such as the NHAI and the Indian Railways contribute in substantial measure to fixed assets creation in the economy. Public procurement as a percentage of GDP in the country is estimated between 20 percent and 22 percent. For a size of Indian economy at $2.7 trillion, this amounts to public procurement to the tune of $500 billion annually. CPSEs are a major contributor to public procurement of works, goods and services.
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