NEW DELHI: The Union Budget's focus on capital expenditure (CAPEX)  is expected to crowd in private investment and push the Gross domestic product growth rate close to 7 percent in the next financial year beginning April 1, said a Reserve Bank article on'State of the Economy'.

In 2023-24, capital expenditure is budgeted at Rs 10 lakh crore which will constitute 3.3 percent of GDP. "We believe that India will decouple from macroeconomic projections of the current vintage and also from the rest of the world. "In our view, the instrument of decoupling will be the Union Budget by raising India's growth prospects over the period 2023- 27; and raising India's potential growth," said the article 'State of the Economy published in the RBI's February 2023 Bulletin.

It further said the Union Budget's tax, capex and fiscal consolidation proposals can take India's real GDP growth close to 7 percent in 2023-24 if they are effectively implemented. "The Union Budget 2023-24's emphasis on capital expenditure is expected to crowd-in private investment, strengthen job creation and demand, and raise India's potential growth," said the article authored by a team lead by RBI Deputy Governor Michael Debabrata Patra.

The Economic Survey tabled in Parliament a day head of the Union Budget projected the GDP growth at 6.5 per cent as the base. The central bank, however, said the views expressed in the article are of the authors and do not represent the views of the Reserve Bank of India (RBI). Recalling mythologies across civilisations, the authors said the sun is depicted as riding a chariot typically drawn by four horses. This is so, for instance, for Apollo in Greece; Ra in Egypt; Sol in Rome. In Indian mythology, however, the sun's chariot isdrawn by seven horses.

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