Capital Expenditure

Why it matters

• It acts as a primary driver for long-term economic growth by enhancing the productive capacity of the economy.
• It creates a multiplier effect by stimulating demand for raw materials and labor in sectors like construction and manufacturing.
• It facilitates the development of essential public infrastructure, which reduces logistics costs and improves overall economic efficiency.

How it is asked

Focus on the distinction between Capital and Revenue expenditure, the impact of Capex on the fiscal deficit, and its role in the government's strategy for counter-cyclical fiscal policy.