State administrations increased new expenditure by 67% to nearly ₹1.62 lakh crore, surpassing the central government’s investment plans, which, however, registered a sharper spike of 185.6% and reached around ₹1.54 in the second quarter lakh crore. | Photo credits: Getty Images/iStockphoto
New investment plans rebounded strongly in the July to September quarter, with public investment recovering from a lull in the first quarter due to the general election, and private investors also ramping up activity, albeit at a slower pace, leaving spending on new projects rose to the second highest level. the past year and a half.
Total investments rose 42.5% to ₹9.21 lakh crore in the second quarter (Q2) of 2024-25, compared to the April-June quarter or Q1, when new investment announcements more than halved on a sequential basis were up to ₹6.46 lakh crore. State administrations increased new expenditure by 67% to nearly ₹1.62 lakh crore, surpassing the central government’s investment plans, which, however, registered a sharper spike of 185.6% and reached around ₹1.54 in the second quarter lakh crore.
Private sector investments grew at a more modest pace of 22.2% but accounted for nearly 66% of total investments, with foreign investors doubling their planned bets in the Indian market from the first quarter to ₹54,519 crore in the second quarter. Domestic private capital recorded a 17.5% increase in the value of new investment plans, accounting for ₹5.51 lakh crore in new expenditure, according to data from Projects Today, which has been tracking new and ongoing investment projects in the country since 2000.
Maharashtra at the top
Among states, Maharashtra remained the biggest draw for investors, as was the case in the first quarter, with 661 projects worth ₹2.81 lakh crore. Gujarat recovered from the fifth spot in the first quarter and attracted the second highest investments worth nearly ₹1.39 lakh crore in the second quarter.
Karnataka, with ₹97,740 crore of new projects, and Tamil Nadu (₹46,662 crore) ranked third and fourth in the second quarter, regaining ground from the first quarter, when they had slipped to eighth and tenth positions respectively . The erstwhile state of Jammu and Kashmir entered the list of top 10 states for the first time and signed investment plans worth ₹18,592 crore.
“In the first quarter of this fiscal year, announcements of major projects by the central government agencies were postponed due to the election code of conduct during the Lok Sabha polls, and the private sector had also postponed the unveiling of major investment plans. But with a stable government restored at the Center on June 9, the second quarter has witnessed an increase in investment announcements by both public and private sectors,” Shashikant Hegde, Director and CEO, Projects Today, told IPS. The Hindu.
Mining was the only sector to record a quarter-on-quarter contraction in new investment projects in the second quarter, down 18.1%, while manufacturing expenditure rose nearly 79% to over ₹ 2.22 lakh crore and new infrastructure projects rose 45% to around ₹. 4.17 lakh crore. Electricity and irrigation projects increased by 24.2% and 24.7% respectively.
Of the 2,684 new investments announced in the second quarter, 1,093 were government projects, while 1,591 came from the private sector. The Projects Today survey showed that the number of mega projects worth at least ₹ 1,000 crore rose from 132 schemes worth ₹ 4.02 lakh crore in the first quarter to 173 projects worth ₹ 6.38 lakh crore in the second quarter, indicating greater confidence among project promoters.
Mr Hegde expected this upward trend in project investments to continue over the next two quarters, but emphasized that the key to unlocking the full potential of these investments lies in rapid and effective execution. “Ensuring timely implementation of announced projects is critical for India to not only meet its higher growth ambitions but also generate much-needed employment,” he underlined.
Published – Oct 28, 2024 03:00 IST
