New Delhi – Chief Economic Adviser (CEA) V Anantha Nageswaran has called on Indian states to significantly enhance their capital expenditure and improve the readiness of development projects to attract greater private investment. Speaking at the conclusion of a two-day conference on financing India's journey towards Viksit Bharat 2047, Nageswaran emphasized the critical role states play in achieving the nation's long-term development targets.
Strengthening State-Level Investment for Viksit Bharat
Nageswaran highlighted that India faces the dual challenge of sustaining its long-term development trajectory while rapidly mobilizing resources over the next five years, a period when global financing opportunities are expected to be favorable. To meet the ambitious Viksit Bharat 2047 goal, states must focus on creating an environment that actively encourages private sector participation.
Key areas for improvement, according to the CEA, include addressing issues related to land acquisition, power supply, logistics, and streamlining regulatory clearances. These factors directly influence the viability and pace of investment projects. He also stressed the importance of robust project preparation, urging states to develop credible project reports and well-defined project pipelines to make initiatives more attractive to both domestic and international financial institutions.
Boosting Capital Outlay and Credit Access
The conference, held in New Delhi, also saw discussions on strengthening state-level public investment. Sudhir Shrivastava, former Additional Chief Secretary of Maharashtra, proposed increasing the capital outlay of states from the current 2.4% of Gross State Domestic Product (GSDP) to 3% by the fiscal year 2031-32. This increase is seen as vital for states to bolster infrastructure development and support various growth projects.
Nageswaran further advocated for directing credit towards underserved districts that possess significant growth potential. Improving access to financing in these regions, he noted, could broaden the benefits of economic development across the country. The discussions at the conference also touched upon the substantial financing requirements for agricultural transformation and the complex energy transition, including renewable energy, transmission infrastructure, battery storage, and carbon capture technologies.
“The journey towards the 2047 development target would depend significantly on the role played by states. They need to translate policy reforms and recommendations into partnerships with clear responsibilities and timelines,” Nageswaran stated.
Working groups comprising state representatives are expected to advance these discussions, identifying sector-specific financing needs and formulating actionable recommendations to drive India's economic progress.