In a press briefing on Saturday, finance minister Nirmala Sitharaman asked the central public sector enterprises (CPSEs) to pay outstanding dues to dealers and vendors by 15 October.
Sitharaman also said that no excuses will be heard beyond the deadline.
A portal will be set up by 15 October to allow service providers, vendors and contractors to track bills and payments so as to mitigate liquidity crunch.
Sitharaman met with 32 CPSEs in New Delhi to discuss outstanding payments issue and capital expenditure situation.
Finance Secretary Rajiv Kumar said 34 central PSUs have already spent Rs 48,077 crore till August and have detailed spending of another Rs 50,159 crore till December 2019. Another Rs 54,700 crore would be spent in the January-March quarter.
Expenditure Secretary Girish Chandra Murmu said capex of all the 242-odd PSUs will be over Rs 4 lakh crore.
On Friday, Murmu said the Centre has spent Rs 2.18 lakh crore for capital expenditure so far in the financial year 2020.
The government has been working to increase the capex to boost the economy.