R Krishna Das
Raipur, October 10
Mineral-rich Chhattisgarh state had topped the table of attracting fresh investment, according to Projex Survey data of projects today.
Chhattisgarh topped the table by attracting fresh investment of Rs 35,771.3 crore in the form of 114 projects while Tamil Nadu was ranked second with 132 new projects worth Rs 23,331.85 crore. The third ranked state, Karnataka, attracted Rs 19,958.9 crore with the highest number of new projects, 287.
Gujarat and Maharashtra followed the leaders with fresh investments of Rs 15,532.1 crore and Rs 15,004 crore respectively.
The Rs 22,653 crore Bodhghat Irrigation project and a couple of mining projects worth Rs 8,197 crore by South Eastern Coalfields helped Chhattisgarh top the investment table in the second quarter of the financial year 2020-21 (Q1/FY21).
The complete lockdown of the economy, migration of labour to their hometown, disruption of supply chain infrastructure and non-availability of liquidity at reasonable interest rates affected the private sector the most in Q1/FY21. However, the stage-wise unlocking of the economy from June 2020 onwards saw a jump in the private investment both in terms of number of projects and investment planned therein.
Across the country the private sector announced 618 new projects worth Rs 83,608.2 crore in Q1/FY21 as against 315 new projects worth Rs 44,714.6 crore announced in the previous quarter. In terms of project investment this indicated a rise of 87.0 percent. Compared with a year ago statistics, this indicated a fall of just seven percent.
The impressive increase in fresh investment proposals, increased tendering activities and a sharp jump in the number of finalised project contracts in Q2/FY21 vis-à-vis the preceding quarter do indicate a bounce back in projects investment activities in India. However, it would be too early to proclaim the return of normalcy in project investment.
The project implementation ratio (projects investment under execution as percentage of total outstanding investment) improved by a tad from 37.0 percent in Q1/FY21 to 37.53 percent in Q2/FY21. This indicates that at ground level, project execution has not gained much traction in the second quarter. The pain issues like scarcity of labour, supply chain disruption and liquidity persisted in Q2/FY21 too.
Though on its part the Central government is doing its best to prop up the sagging economy through various reform measures, it will take a while for actual projects investment to gain pace at ground level. Among the major sectors, Drugs and Pharma, Healthcare, Roadways, e-Commerce and Social Infrastructure will see increased investment in coming months, the report said.
While the good monsoon and increase in agri-procurement prices have raised the hope of demand revival in coming quarters, early containment of the COVID-19 pandemic, complete unlocking of the economy and increased government spending will nudge the economy back to the high growth orbit.
