Maharashtra’s capex surged 207.9 per cent to ₹18,472 crore, while Punjab’s rose 200.5 per cent to ₹4,299 crore

States appear to be going slow with their capex expenditure in FY27. businessline analysis of data from CAG for April to July 2026 shows that 6 of the top 15 States, ranked by GDP, have spent less on capex in FY27 compared to the same period in FY26. Only one State, Kerala, has managed to spend more than 25 per cent of its budgeted allocation for capex so far.

West Bengal’s capex registered the sharpest decline of 52.9 per cent to ₹1,670 crore during April-July 2026, from ₹3,544 crore in the corresponding period last year. Bihar followed with a 40.5 per cent decline to ₹7,155 crore, while Haryana and Madhya Pradesh recorded declines of 25.1 per cent and 21.2 per cent, respectively.

Odisha and Uttar Pradesh also reported lower spending, declining 6.3 per cent and 3.8 per cent, respectively.

At the other end, Maharashtra’s capex surged 207.9 per cent to ₹18,472 crore, while Punjab’s rose 200.5 per cent to ₹4,299 crore. Kerala (69.1 per cent), Telangana (54.9 per cent), and Karnataka (28.7 per cent) also recorded strong growth.

However, the sharp year-on-year movements need to be viewed in the context of how state expenditure is recorded and the timing of project execution.

“First four months may not be the right way to look at it,” said Madan Sabnavis, Chief Economist at Bank of Baroda. He said States typically review their revenue position during the year and may accelerate capital expenditure later, particularly towards the fourth quarter.

The pace of spending is also reflected in the proportion of the FY27 capital expenditure budget already utilised.

Kerala had utilised 42.4 per cent of its ₹19,718 crore budget allocation by July 2026, the highest among the 15 States. Punjab followed at 23.4 per cent, Madhya Pradesh at 22.9 per cent, and Andhra Pradesh at 20.5 per cent.

In contrast, West Bengal had utilised only 4 per cent of its ₹41,315 crore allocation. Uttar Pradesh, which has the largest allocation at ₹1.78 lakh crore, had utilised 10.2 per cent, while Odisha was at 12 per cent.

Anil Sinha, Director & Senior Professor at the Fortune Institute of International Business, Delhi, said early-year capex depends heavily on project preparedness, approvals, tendering, and fund releases. States with projects ready for execution can front-load expenditure, while delays can push spending into the second half of the year.

Sabnavis also pointed to fiscal constraints and project availability as factors determining the pace of spending. “Capex is something which you can always cut back on to make sure that you meet your fiscal deficit target,” he said.

Published on September 18, 2026