CAG flags sharp fall in capital spending under AAP Government, infra projects hit

The Aam Aadmi Party (AAP) Government’s tenure in Delhi saw a decline in capital expenditure, thereby severely impacting key infrastructure projects like roads, bridges and transport in Delhi from 2021-22 to 2024-25, as the expenditure came down from Rs 8,311 crores to Rs 3,695 crores.

Flagging these figures in its latest report, the Comptroller and Auditor General (CAG) said capital expenditure over the period showed a declining trend rather than consistent growth, indicating a reduction in the GNCTD’s investment in long-term assets and infrastructure. The CAG report further pointed out

The report on the finances of Delhi Government for 2024-25 analysed overall financial health, expenditure trends, debt position, and compliance with fiscal responsibility during the period when the Aam Aadmi Party (AAP) was in power in Delhi.

“Capital Expenditure has declined to Rs 3,695 crore in year 2024-25 as compared to Rs 6,855 crore in year 2023-24. The decline was due to less expenditure in the different heads such as from Rs 1,936.14 crore in 2023-24 to Rs 909.30 crore in 2024-25 under head MH 5054 — Capital outlay on Roads and Bridges; from Rs 1,448 crore in 2023-24 to Rs 390 crore in 2024-25 under head MH 5055- Capital outlay on Road Transport; from Rs 637.43 crore in 2023-24 to  Rs 263.97 crore in 2024-25 under head MH 4202- Capital outlay on Education, Sports, Art & Culture-General Education,” the report said.

It said the overall share of capital expenditure relative to the economy has been declining in the last few years, suggesting that the GNCTD has not consistently prioritized asset creation in line with its growth objectives. This pattern implies limited fiscal space for sustained investment in infrastructure and development programs, potentially affecting long-term economic growth and service delivery.

The economic growth and gross state domestic product (GSDP) of Delhi showed a “healthy trend” in 2024-25. The GSDP at `12.15 lakh crore registered a growth of 9.17 per cent over the previous financial year, the report by the Comptroller and Auditor General (CAG) of India said.

It said Delhi contributed 3.67 per cent to the gross domestic product (GDP) of India in 2024-25. GDP refers to the total value of goods and services produced within a country, while GSDP measures the same at the state or Union territory level, and both reflect economic development and overall progress.

The annual growth of per capita GSDP (6.39 per cent) measured in terms of compound average growth rate (CAGR) during 2015-2025 remained lower than the annual growth in per capita GDP (8.14 per cent) during the same period, according to the report.

The contribution of Delhi’s GSDP to the GDP showed an overall declining trend during the last 10 years, decreasing from 4 per cent in 2015-16 to 3.67 per cent in 2024-25, indicating that Delhi’s growth did not keep pace with the overall growth of the national economy, the report said.

“This is evidenced from the fact that the per capita GSDP of the NCT of Delhi, which was 177.07 per cent more than the per capita GDP of the country in 2015-16, was 135.34 per cent greater at the end of 2024-25. This reflects the slightly slower economic growth of the Delhi Government compared to the rest of the country,” the report said.  It was observed that the revenue receipts of the Delhi Government grew by 9.57 per cent, driven by higher tax collections, most notably the goods and services tax (GST).

However, non-tax revenue growth was negative (-11.04 per cent) and grants from the Centre declined, the report said.