Financial Daily from THE HINDU group of publications
Friday, Nov 15, 2002
Financial Daily from THE HINDU group of publications Friday, Nov 15, 2002 |
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Industry & Economy
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Infrastructure Project investments flat in Sept quarter: Survey Our Bureau
HYDERABAD, Nov. 14 THE services sector, which has been a major engine of growth in the country over the past year or so, is among the sectors affected by the general slowdown in the investment scenario, according to a survey. The findings indicate that project investments had suffered `near stagnation' in the quarter ended September 2002. Within the services sector, hospitals, real estate and transport services received increased investments proposals, whereas traditional favourites — telecom, hotels and tourism — failed to attract significant investment proposals. A survey of projects investment by Projectstoday.com, a division of the Mumbai-based Economic Research India Ltd, stated that as of September 30, 2002 the aggregate project investments in the country was Rs 17.82 trillion (about $ 370 billion). This was only 0.8 per cent higher than the comparable level of June 30. The survey indicated there were 7,119 live projects in various stages of implementation, as of September 30, which entails a total investment of Rs 17,82,594 crore. On a quarter-on-quarter basis, the aggregate investment was marginally higher by 0.8 per cent. The manufacturing and electricity sectors, which together accounted for nearly half of the total investment, were mainly responsible for the overall dismal performance. While project investments in the electricity sector stagnated during the period ended September 2002, the manufacturing sector declined by about 1.5 per cent. On the other hand, the mining sector posted a 6.7 per cent rise in project investments and shored up the overall project investment scenario. The bulk of the increased investment proposals in the sector were focussed on metallic ore and coal mining while oil exploration failed to attract significant fresh investment proposals. However, the overall projects implementation ratio, which is an indicator of actual investments at the ground level, declined from 39.4 per cent in June 2002 to 38.1 per cent in September 2002. Interestingly, both Central and State Governments continued to dominate in project investments with a share of 60 per cent. However, the outstanding investment in this sector increased by one per cent. Further, the uncertainty over the privatisation of large PSUs in the oil and other sectors has resulted in hold-up of fresh investment plans, according to findings. Maharashtra retained its position as the number one State in terms of overall projects investments, followed by Gujarat, Andhra Pradesh and Karnataka and Tamil Nadu. The survey further noted that the rise in FDI (foreign direct investment) inflow reported in the first half of 2002, had begun to reflect positive trend.
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