Central Public Sector Enterprises (CPSEs) capex rose by 6.5% to ₹50,206 in April: Railways, NHAI lead in fresh investments

The Central Public Sector Enterprises (CPSEs) capital expenditures (capex) grew by 6.5% to ₹50,206 crore in April this year. The surge reflects the government’s efforts on investment-led economic growth apparently because it has come at a time when the 18th General Lok Sabha elections were underway in the country.

The Indian Railways, with its continuous heavy investment in capacity-building works such as doubling and quadrupling, electrification and introduction of high-speed trains in the country, invested ₹26,641 crore in April. This investment in projects by the Railways is 10% more than last year’s investment in the same period.

In the first month of FY25, the Indian Oil Corporation, a major fuel retailer and refiner, reported a capex of ₹2,423 crore. It is an increase of 8% YoY.

On the other hand, ONGC, the top state-run enterprise in oil and gas exploration, achieved a capex of ₹2,318 crore in April, a 7.5% jump from the same month the year before.

Adding to CPSE’s April capex, the National Highways Authority of India (NHAI) invested ₹6,645 crore, which is higher by 4% annually.

Power generation behemoth, NTPC saw its capex grow by 9% YoY to ₹2,083 crore in April. Coal India invested ₹1,073 in April, which is a 75% growth on-year.

The CPSEs, run by the different ministries, have a key role in the country’s industrial development. The CPSEs cater to various sectors of the economy including civil construction, heavy machinery, tea plantation, heavy electrical engineering equipment, etc.

The government’s major investment in CPSEs, mainly in the railways and NHAI also helps to create employment.

India’s GDP leapt by 8.2% in FY24, beyond the expectations of domestic and multilateral institutions. This can be somewhat attributed to a 9% growth in gross fixed capital formation led by public capex.

The CPSEs exceeded their combined capital expenditure target for FY24 by 109%, with an investment of ₹8.05 trillion, an all-time high.

Because of a growing economy and demand propelled by various government initiatives, infrastructure and allied firms are hiking their capital expenditure for FY25.

Meanwhile, the CPSEs have decided on a combined target of investing ₹7.8 trillion in FY25.