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Centre Approves Rs. 56,415 Crore to 16 States under ‘Special Assistance to States for Capital Investment 2023-24’ Scheme

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The Department of Expenditure, Ministry of Finance, Government of India, has granted approval for capital investment proposals totaling Rs. 56,415 crore to 16 States in the current financial year. This significant allocation falls under the ‘Special Assistance to States for Capital Investment 2023-24’ scheme, aiming to provide timely impetus to capital spending by States. The approved funds will support a range of projects in sectors such as health, education, irrigation, water supply, power, roads, bridges, and railways.

About the Scheme

The ‘Special Assistance to States for Capital Investment 2023-24’ scheme was introduced in the Union Budget 2023-24. Its objective is to enhance capital expenditure by providing special assistance to State Governments. Under this scheme, States are granted a 50-year interest-free loan, with an overall budget of Rs. 1.3 lakh crore for the financial year 2023-24. The scheme comprises eight parts, with Part-I constituting the largest allocation of Rs. 1 lakh crore. The distribution of funds to States is based on their share of central taxes and duties as per the 15th Finance Commission’s award.

Key Points about the Scheme

  1. Capital Investment Approval: The Ministry of Finance has approved capital investment proposals amounting to Rs. 56,415 crore for 16 States. The funds will be utilized for various capital projects, including those in the fields of health, education, irrigation, water supply, power, roads, bridges, and railways.

  2. Sectoral Focus: The scheme aims to bolster investment in key sectors and infrastructural development. Additionally, it provides funds for the State share of important initiatives such as the Jal Jeevan Mission and the Pradhan Mantri Gram Sadak Yojana, thereby expediting progress in these sectors.
  3. Parts of the Scheme: The scheme is divided into eight parts, each addressing specific objectives and reforms. Part-II focuses on providing incentives to States for scrapping government vehicles, while Part-III and IV incentivize reforms in urban planning and urban finance, respectively. Part-V aims to increase housing stock for police personnel in urban areas. Part-VI promotes national integration and the “Make in India” concept through the construction of Unity Malls in each State. Part-VII is dedicated to providing financial assistance for the establishment of libraries with digital infrastructure at the Panchayat and Ward levels.
  4. Previous Year’s Performance: In the previous financial year, the Ministry of Finance executed a similar scheme, ‘Special Assistance to States for Capital Investment for 2022-23.’ Under this scheme, capital investment proposals worth Rs. 95,147.19 crore were approved, and an amount of Rs. 81,195.35 crore was disbursed to the States.
  5. Positive Response: The scheme has received commendation from Chief Ministers and Finance Ministers of States due to its flexibility and simplified design. It has played a crucial role in supporting capital spending by States, especially during the COVID-19 pandemic.

State-wise Allocation

Centre Approves Rs. 56,415 Crore to 16 States under 'Special Assistance to States for Capital Investment 2023-24' Scheme_40.1
Centre Approves Rs. 56,415 Crore to 16 States under ‘Special Assistance to States for Capital Investment 2023-24’ Scheme

The capital investment proposals approved under the ‘Special Assistance to States for Capital Investment 2023-24’ scheme have been allocated to the following States:

  1. Arunachal Pradesh: Rs. 1,255 crore
  2. Bihar: Rs. 9,640 crore
  3. Chhattisgarh: Rs. 3,195 crore
  4. Goa: Rs. 386 crore
  5. Gujarat: Rs. 3,478 crore
  6. Haryana: Rs. 1,093 crore
  7. Himachal Pradesh: Rs. 826 crore
  8. Karnataka: Rs. 3,647 crore
  9. Madhya Pradesh: Rs. 7,850 crore
  10. Mizoram: Rs. 399 crore
  11. Odisha: Rs. 4,528 crore
  12. Rajasthan: Rs. 6,026 crore
  13. Sikkim: Rs. 388 crore
  14. Tamil Nadu: Rs. 4,079 crore
  15. Telangana: Rs. 2,102 crore
  16. West Bengal: Rs. 7,523 crore

These allocations reflect the diverse range of sectors and projects that will receive funding, including health, education, irrigation, water supply, power, roads, bridges, and railways.

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