India's investment proposals to be lowest since 2004-05 in fiscal 2017-18; just 60% of those in 2016-17, predicts CMIE

Click on the photograph for an enlarged view

By Rajiv Shah
The Centre for Monitoring Indian Economy (CMIE), the country's top independent consultant, has said that the fiscal 2017-18 "is likely to go down as the worst possible year for investments in India", predicting, "New investment proposals are likely to stabilise around Rs 8 trillion in 2017-18, which would be about 60 per cent of the new proposals made during 2016-17 and would be the lowest level since 2004-05."
Coming against the backdrop of the Government of India basking in the glory over "rise" in Gross Domestic Product (GDP) in the last quarter from 5.7% to 6.3%, the CMIE's fresh analysis, based on the data it has collected, says, "This would be the third consecutive year of a fall in new investments since they spiked momentarily in 2014-15. The difference is that the fall in 2017-18 would be sharper than in earlier years."
The CMIE further says, "Revival of projects that were shelved or abandoned earlier would likely add up to about Rs 1.2 trillion in 2017-18. This would be half of the revivals in 2016-17. Nevertheless, they assume greater importance now than ever before in the light of the fall in new investment proposals."
The CMIE continues, "Revived projects would account for nearly 15 per cent of new proposals in 2017-18. In 2016-17, they were 18 per cent of the value of all new projects. Till 2012-13, they were less than 10 per cent of new proposals". It adds, "Total investments made during the entire implementation of projects that would be completed during 2017-18 are likely to add up to a Rs 4 trillion. This is much smaller compared to Rs 6.3 trillion in 2016-17 and Rs 5.8 trillion in 2015-16."
Pointing out that the sum of Rs 4 trillion is "very small compared to the Rs 11 trillion worth of completions that were initially supposed to be commissioned during the year", the CMIE reveal, "Companies kept delaying their completion dates, and as a result, the estimates of completions during 2017-18 came down progressively during the year to Rs 9 trillion and then to Rs 7 trillion."

Mahesh Vyas

The analysis, by Mahesh Vyas is Managing Director and CEO of the CMIE, says, "The value of projects that get stalled, abandoned or shelved increased during 2017-18. In the first three quarters these added up to Rs 3.9 trillion which is the same as it was in the entire fiscal 2016-17." It adds, they are "slated to increase" to about Rs 6 trillion in fiscal 2017-18.
Noting that "another Rs 5.9 trillion worth of projects were dropped because of lack of any information on them for a very long time", the CMIE says, "Thus, the total attrition during the first three quarters was investments worth Rs 9.9 trillion", which could "cross Rs 14 trillion" in fiscal 2017-18.
In fact, according to the CMIE, "The ratio of projects attrition to accretion, i.e the ratio of projects stalled or dropped to the addition of projects because of new announcements or revival of old ones, is expected to rise sharply during 2017-18", adding, "Attrition would exceed accretions by over 50%... In the past, attrition of investments has never exceeded accretions."
Admitting that the "CMIE is somewhat conservative in announcing that a project is stalled", the analysis says, "Compared to the investments stalled, a much larger value of outstanding investments sits under the header 'Projects with no information, but live'. These amounted to Rs 15.8 trillion as of the end of December 2017 compared to accretions that amounted to Rs 9.9 trillion during the first three quarters ended December 2017."
Even as saying that "the pipeline of investments may quite big at Rs 182 trillion", thr CMIE does not fail to point out that "this pipeline hasn’t grown. It has, in fact, shrunk from its peak of Rs 185 trillion as of March 2017. Half of these outstanding projects have moved beyond the stage of mere announcements..."

Comments

Bill Gates as funder, author, editor, adviser? Data imperialism: manipulating the metrics

By Dr Amitav Banerjee, MD* When Mahatma Gandhi on invitation from Buckingham Palace was invited to have tea with King George V, he was asked, “Mr Gandhi, do you think you are properly dressed to meet the King?” Gandhi retorted, “Do not worry about my clothes. The King has enough clothes on for both of us.”

Stagnating wages since 2014-15: Economists explain Modi legacy for informal workers

By Our Representative Real wages have barely risen in India since 2014-15, despite rapid GDP growth. The country’s social security system has also stagnated in this period. The lives of informal workers remain extremely precarious, especially in states like Jharkhand where casual employment is the main source of livelihood for millions. These are some of the findings presented by economists Jean Drèze and Reetika Khera at a press conference convened by the Loktantra Bachao 2024 campaign.

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah* The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual.

Magnetic, stunning, Protima Bedi 'exposed' malice of sexual repression in society

By Harsh Thakor* Protima Bedi was born to a baniya businessman and a Bengali mother as Protima Gupta in Delhi in 1949. Her father was a small-time trader, who was thrown out of his family for marrying a dark Bengali women. The theme of her early life was to rebel against traditional bondage. It was extraordinary how Protima underwent a metamorphosis from a conventional convent-educated girl into a freak. On October 12th was her 75th birthday; earlier this year, on August 18th it was her 25th death anniversary.

'Assault on civic, academic freedom, right to dissent': TISS PhD student's suspension

By Our Representative The Mumbai-based civil rights group All India Secular Forum (AISF) has said that the suspension of Tata Institute of Social Sciences (TISS) PhD student Ramadas Prini Sivanandan (30) for two years for allegedly indulging in activities which were "not in the interest of the nation" is meant to send out the message that students and educational institutes will be targeted if they don’t align with the agenda and ideology of the ruling regime. TISS in a notice served to Ramadas has cited that his role in screening the documentary 'Ram Ke Naam' on January 26 as a "mark of dishonour and protest" against the Ram Mandir idol consecration in Ayodhya. Another incident cited in the notice was Ramadas’ participation in the protest against unfair government policies in Delhi under the banner of the Progressive Students' Forum (PSF)-TISS. TISS alleges the institute's name was "misused", which wrongfully created an impression that

Joblessness, saffronisation, corporatisation of education: BJP 'squarely responsible'

Counterview Desk In an open appeal to youth and students across India, several student and youth organizations from across India have said that the ruling party is squarely accountable for the issues concerning the students and the youth, including expensive education and extensive joblessness.

Why it's only Modi ki guarantee, not BJP's, and how Varanasi has seen it up-close

"Development" along Ganga By Rosamma Thomas* I was in Varanasi in this April, days before polling began for the 2024 Lok Sabha elections. There are huge billboards advertising the Member of Parliament from Varanasi, Prime Minister Narendra Modi. The only image on all these large hoardings is of the PM, against a saffron background. It is as if the very person of Modi is what his party wishes to showcase.

Following the 3000-year old Pharaoh legacy? Poll-eve Surya tilak on Ram Lalla statue

By Sukla Sen Located at a site called Abu Simbel in Nubia, Upper Egypt, the eponymous rock temples were created in 1244 BCE, under the orders of Pharaoh Ramesses II (1303-1213 BC)... Ramesses II was fond of showcasing his achievements. It was this desire to brag about his victory that led to the planning and eventual construction of the temples (interestingly, historians say that the Battle of Qadesh actually ended in a draw based on the depicted story -- not quite the definitive victory Ramesses II was making it out to be).

Poll promises: Political parties 'playing down' need to retrieve and restore adivasi land

By Palla Trinadha Rao* The Scheduled Tribes population of 10.43 crore constitutes 8.6% of the population in the country inhabiting 26 States and 6 Union Territories. Parliament elections along with Assembly elections in some states have been notified this year.

India's "welcome" proposal to impose sin tax on aerated drinks is part of to fight growing sugar consumption

By Amit Srivastava* A proposal to tax sugar sweetened beverages like tobacco in India has been welcomed by public health advocates. The proposal to increase sin taxes on aerated drinks is part of the recommendations made by India’s Chief Economic Advisor Arvind Subramanian on the upcoming Goods and Services Tax (GST) bill in the parliament of India.

Counterview

Search This Blog