Projects investment down in Q1 of current fiscal: ProjectsToday Study
For the first quarter of April-June 2009, 1,851 projects worth Rs 1,12,319 crore were announced. Compared with the preceding quarter, this indicated a fall of 31.2 per cent in terms of number of projects and 30.4 per cent in terms of investment.
ProjectsToday, India’s largest online database on projects investment in India, today released a detailed report on “Project Investments in India” for the first quarter of Financial Year 2009-2010 (April 1, 2009 to June 30, 2009). The report also analysed the projects investment scenario in India since the beginning of the economic recession in September 2008. The study was conducted in the first week of July across 30,825 projects entailing a total investment of Rs 43,97,224 crore.
According to the study, only 1,015 public sector projects were announced during the April-June 2009 period as against 2007 and 2057 projects respectively in the preceding two quarters. Similarly, as against 11,153 project tenders floated in January-March 2009 period, only 9,099 tenders were initiated during the April-June period.
Along with the ongoing economic slowdown, the prolonged process of the General Elections, which commenced in the last week of March 2009 and continued till the last week of May, delayed the decision making process in public sector companies on project launches and floatation of projects tenders that indicate progress in implementation, stated the report.
Major findings of the study
- The National Highways Authority of India is likely to invite fresh bids for 38 highways projects after restructuring their terms and conditions. Post restructuring, these projects are expected to entail investment in the range of Rs 45,000 - 50,000 crore.
- Around Rs 15,000 crore of investment is expected to take place in the next one to two years in the telecom sector. Telecom majors like Airtel, Aircel, Idea, Tata Telecom, Reliance and MTNL have already announced investment plans of over Rs 1,000 crore.
- During April-June 2009 period, 166 new power projects worth Rs 55,756 crore were announced. Of this 106 were by private sector. The quarter also saw, Reliance Power achieving financial closure for two of its mega project – Dadri Power project and Sasan UMPP.
- Fresh investment commitments in the beleaguered Real Estate sector nosedived by 25 per cent during the April – June 2009 period, as compared with the preceding quarter.
- In the manufacturing sector, where the dominance of private sector is more pronounced, fresh investments contracted by 14.8 per cent in the first quarter of the current fiscal as compared with the last quarter of the preceding fiscal 2008-09.
- Among the major sectors, baring Electricity, all sectors – Manufacturing, Mining, Infrastructure and Irrigation saw decline in fresh investment announcements.
- As of end June, the Board of Approval (BoA) for SEZs had issued formal approval for 576 SEZs. Of this, 319 were notified by the respective state governments. However, only a few of the notified are currently under execution.
According to Shashikant Hegde, CEO, ProjectsToday, “We do not see likelihood of any major reversal of the slowdown in investment in the next three months. However, with the latest Union Budget laying greater emphasis on higher spending on rural as well as urban infrastructure, the overall project investment scenario should show signs of improvement in the second half of the current fiscal.”
About ProjectsToday
ProjectsToday.com is the largest online database on projects investment in India. The website was launched on 8 September 2000 at the auspicious hands of Shri. Vallabhbhai Kathiria, the then Hon'ble Union Minister of State for Heavy Industries & Public Enterprises. The primary objective of ProjectsToday is to provide an invaluable marketing resource to assist business development efforts of those organisations focussing on the new projects market. ProjectsToday has wide-ranging applications to professionals in industry, finance, consultancy, academia and research. The database is also an indispensable tool for policy planners in Central and state governments to study investment trends on an ongoing basis. The research effort is thus dedicated to track the ongoing investment activities across the country in diverse economic sectors. Hence, details on all investment projects - whether merely envisaged or actually under implementation - can unfailingly be found in the website, www.projectstoday.com.