constituted - of Planning Commission

Non-Plan ExpenditureA broad assessment indicates that total Non-Plan Expenditure increased sharplyduring the Eleventh Plan from `5,07,589 crore in 2007-08 to `8,16,182 croreprojected in B.E. 2011-12, resulting in a increase of 60.8 per cent as comparedto a 37 per cent increase during the Tenth Plan period from `3,01,778 crore to`4,13,527 crore. The details of component-wise Non-Plan Expenditure duringthe Eleventh Plan are indicated in Table 4.1.The projections made by the Group in respect of Non-Plan Expenditure arebased on the aggregate of individual components.Revenue ExpenditureNon-Plan Revenue Expenditure has increased during the Eleventh Plan by74.30 per cent from `4,20,861 crore in 2007-08 to `7,33,558 crore in 2011-12(BE) compared to 39.32 per cent during the Tenth Plan period. As per theestimates of the Sub-Group, revenue expenditure is projected to increase from`7,33,558 crore in 2011-12 to `11,31,272 crore in the terminal year of theTwelfth Plan (2016-17), implying an average annual rate of growth of 9.10 percent. The projections on Revenue Expenditure are based on the aggregate ofindividual components, which are discussed below:-Interest Payments: Expenditure on Interest Payments increased during theEleventh Plan by 56.69 per cent from `1,71,030 crore in 2007-08 to `2,67,986in 2011-12, as compared to a percentage growth of 27.6 per cent during theTenth Plan. The Group noted that for Interest Payments, the Thirteenth FinanceCommission has used projections consistent with the growth in adjusted debtstock allowed by the FRBM path. The Commission projected interest paymentsusing an average interest rate of 7.35 per cent for debt contracted till 2009-10and 7.5 per cent for the subsequent years on the incremental borrowing requiredto finance the fiscal deficit of the previous year. This would imply that interestWorking Group Report on Centre’s Financial ResourcesPage-32