Major Public Sector Enterprises Commit Rs 1.5 Lakh Crore Worth Capex In FY20

Finance Minister Nirmala Sitharaman on Saturday took stock of total capital expenditure by major Central Public Sector Enterprises (CPSEs) so far in the current fiscal and directed them to clear payments of all vendors by October 15. The government was told that 34 major CPSEs had already made a capital expenditure of over Rs 48,000 crore till mid-August and that total capex in the current fiscal would cross Rs 1.5 lakh crore.

During the meeting with the heads of CPSEs, Sitharaman directed them to set up a web portal by October 15 for tender participants, service providers and dealers to monitor their dues. She added that a special drive would be launched to meet all the requirements and make all pending payments before October 15.

“The government has given direction to all CPSEs that if the payments did not happen due to various reasons, the PSUs would undergo a drive where they will approach parties between now and the first week of October,” Sitharaman said. 

“The idea is to frontload the capital expenditure,” she added.

Finance Secretary Rajiv Kumar said the total capital expenditure of the 34 CPSEs till Aug 19 was already Rs 48,077 crore, and that they had committed to additional capital expenditure worth over Rs 1 lakh crore in the rest of the current fiscal, taking the total capex in FY20 to over Rs 1.5 lakh crore.

Expenditure Secretary G.C. Murmu said the Ministry would review the expenditure status of the CPSEs every 15 days and the CPSEs, in turn, would submit monthly reports on capex via their nodal ministries.

Sitharaman pointed out that several CPSEs were not procuring equipment and other goods that they needed through the GeM portal even when such equipment were available there.

“Nearly Rs 60,000 crore worth of purchases have been made by the CPSEs outside of GeM. Have asked for details why purchases were made out of the GeM platform. I am not saying that there has been any wrongdoing, and there must be a reason behind that. So I have sought report,” she said.

Murmu said the government would also look into which CPSEs were not procuring through GeM portal. 

The Finance Ministry had asked the CPSEs to share their capital expenditure plans for the next four quarters to help the government ensure that its expenditure plan was on track. The Ministry has been pushing state-run entities to clear all dues owed to vendors, in a bid to kickstart the slowing economic growth, which fell to a six year low of 5 per cent in April-June quarter.

The heads of 34 major CPSEs were present in the meeting including those of Oil India, NHAI, HAL, NHPC, Indian Oil, ONGC, NTPC, GAIL and HPCL, among others.