“The departments are being told to clear pending payments to contractors, especially those in the micro, small & medium enterprises (MSMEs) sector. They will be directed to front-load their capex allocations, while PSUs
are also being told to boost capex. The idea is to create more liquidity in the infrastructure sector,” said an official.
These capex reviews come just a day after Finance Minister Nirmala Sitharaman met representatives of the infrastructure sector — the latest of the many sectoral meetings she has had in the past one month.
The meetings came against the backdrop of India’s gross domestic product growth slumping to a six-year low of 5 per cent in the April-June quarter. Experts have pointed out that a capex boost focused on infrastructure by the private sector and the government is a way out of the slowdown as the Centre looks to create jobs. In his Independence Day speech, Prime Minister Narendra Modi had said the government will invest Rs 100 trillion on developing modern infrastructure to help nearly double the size of the economy to $5 trillion in the next five years.
In the meeting on Wednesday, representatives of infrastructure companies like Hindustan Construction, NHAI, and Ircon had discussed issues related to financing, land, capital, and environmental clearances. There were suggestions on speeding up the execution of projects.