Investment projects bounce back in Q4: report

In the last quarter of 2020-21, with capital expenditure supported by the private sector and government, in the year of the epidemic, fresh investment was strongly reversed, with project execution ratios that reflect real ground levels. The action hit a five-year high.

The Q4 boom raised overall fresh investment to ₹ 10.72 lakh crore in 2020-21, which is a mere 1.2% below the 2019-20 level, although investment in 2018-19 increased from ₹ 16.87 lakh crore in that year. Had fallen from

According to the recent Projects Investment Survey, new project investment in the January to March 2021 quarter is approximately ₹ 4 lakh crore, about ₹ 1 lakh crore or 33.4% higher than the previous quarter.

After an 11.3% drop in investment announcements from the Center and the states in the third quarter, the government’s push for capital expansion eventually translated into new projects with a 21.8% increase during the quarter. More than 1,700 new government projects were announced in Q4, with projects worth ₹ 76,185 crore for central projects and projects worth ₹ 91,067 crore pushed by state agencies.

Path to normal

Since March 2020, Centre’s investment incentives and RBI’s liberal monetary policy have helped improve the investment activity of the projects. Although we are away from the high growth in investment of projects in 2018-19, trends in the last two quarters point towards the normalcy, ”said Shashikant Hegde, director and CEO of investment monitoring firm Projects.

The latest surge in COVID-19 cases and the lockdown situation will certainly be a hindrance to the return to normal, so the government should step up its investment plans, speed up vaccination campaigns and support the private sector to sustain growth Should give in project investment through 2021-22, Mr. Hegde said.

Private sector investment grew 43.5% from Q3 to ₹ 2.26 lakh crore in Q4, with a healthy 40.6% growth in Q3 to a quarter-on-quarter growth of 88.4%.

Mining was the only major sector where investment dried up in the quarter.

Odisha received the highest investment in the quarter of ₹ 62,352 crore, driven by the ₹ 50,000 crore integrated steel plant announced by ArcelorMittal Nippon Steel. Maharashtra and Andhra Pradesh followed projects worth Andhra 40,902 crore, and .939,610.92 crore, respectively.

Revival of immovable property

“” 1 “.81, 51ex new manufacturing projects with total proximity of ₹ 5 crore. New 4 crore were announced in Q4, out of which 12 mega projects (with a cost of ₹ 1,000 crore or more) of ₹ 74,999 crore. Promise to bring in investment, ”reports. said. Overall, 87 mega projects were recorded in the quarter, up from 62 such projects in Q3.

Infrastructure projects, which had been growing since Q2 of the lockdown-hit year, continued to build, while the construction sector, where project execution activities came to a complete standstill after a nationwide lockdown last year, rose for the first time in the year.

After a 20.3% decline in Q3, real estate, commercial complexes and industrial parks grew by 47.4% in Q4, more than doubling from new investment in real estate in Q3 to ling 15,634.6 crore to 90 38,905.4 crore in Q4 .

The food processing, cement and automobile sectors saw a decline in investment in Q4, but drugs and pharma as well as industrial alcohols continued to increase health in the wake of the epidemic.

5 years old

The report stated that the project implementation ratio improved from 36.69% in March 2020 to 37.64% in March 2021, an indicator of the pace of implementation of grassroots projects. This is the highest project execution ratio recorded since March 2016.

“The PREGEX funnel (investment of outstanding projects) grew by 6.2% during 2020-21. As of 31 March 2021, there were 78,271 projects with a total investment of ₹ 1,64,37,923 crore (or $ 2.22 trillion) at various stages of implementation. Of this, 17,709 projects were under execution with a total project exposure of Rs 61,87,368 crore ($ 835 billion), indicating a project execution ratio of 37.64%, ”it reported.