The total amount not spent by central government ministries and departments is expected to be around Rs 25,000 crore (Rs 250 billion), nearly 15 per cent of the gross budgetary support of Rs 172,728 crore (Rs 1,727.28 billion) for the current fiscal year.

According to government data, expenditure during April-December this fiscal was below 40 per cent in 13 departments, 40-60 per cent in 40 departments and above 60 per cent in 56 departments.

Since not more than 15 per cent of a ministry's allocation can be spent in the last month of the fiscal, it is estimated that the unspent balance for the current year could be around 10 per cent.

In an internal meeting last month, Finance Minister P Chidambaram had observed that "inadequate expenditure defeats the very purpose of providing money in the Budget". He made a special mention of 13 departments, which had spent only Rs 16,327 crore (Rs 163.27 billion) of a total outlay of Rs 59,743 crore (Rs 597.43 billion) during the period.

"Departments like defence, non-conventional energy sources, Panchayati Raj have large outlays and they need to make serious efforts to achieve their targets," he had told the financial advisors of the central ministries and departments.

Another 40 departments, to which a large amount of Rs 2,52,594 crore (Rs 2,525.94 billion) was made available in Budget 2006-07, had spent only Rs 1,36,405 crore (Rs 1,364.05 billion) in the period under review.

Chidambaram also expressed concern about the huge reserves building up in public sector enterprises (PSEs).

Calling them free resources, he said: "If there are no capital expenditure plans, the accumulation of free reserves is neither good treasury management nor prudent public finance management. The government should, therefore, get higher dividends."

The finance minister has already directed Finance Secretary Ashok Jha to interact with the ministries that manage large PSEs and ask them to declare higher dividends if large free reserves have accumulated and the companies have no capital expenditure programme in the near future.