All talk and no money? Investments stuck at announcement stage

A staggering 43 per cent of total investment projects worth a humongous Rs 52 lakh crore attracted by states across India remained non-starter as of March 2013, while over 34 per cent of these investments are stuck at the stage of announcement, implementation of about six per cent of projects has been stalled and there is no information of the remaining (three per cent) projects, apex industry body ASSOCHAM said today.

“Investments worth over Rs 69.5 lakh crore i.e. just about 57 per cent of the total investments of over Rs 122 lakh crore attracted from various public and private sources are under implementation stage as of March 2013,” according to an analysis of investments carried out by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

“These dismal figures showcase that owing to prevalence of global recessionary trends and slowdown of Indian economy investments across states have been kept on hold which is worrisome for a country that desperately needs investments,” said Mr D.S. Rawat, national secretary general of ASSOCHAM while releasing the analysis.

“The prevailing unstable external and internal economic conditions, high inflation, credit availability and its cost along with a host of local problems like delays owing to land acquisition have been affecting the investment scenario in India,” said Mr Rawat. “Only states that try to address genuine concerns of investors to possible extent see higher implementation rates.”

Inadequate addressal of project induced displacement, failure of implementation of Resettlement and Rehabilitation (R&R) policies, environmental clearances, bureaucratic delays, lack of clear cut policies and others have been contributing to lower implementation rates of investment projects in India, further highlighted the ASSOCHAM analysis.

With over 82 per cent of investment projects under implementation, Haryana has recorded highest rate of implementation of investments amid industrialized states throughout India.

Jammu and Kashmir (81.4 per cent), Punjab (79 per cent), Assam (72 per cent) and Chhattisgarh (69 per cent) are amid top five states that are currently witnessing a high rate of implementation of investments, according to the ASSOCHAM analysis.

Gujarat has recorded lowest implementation rate as over half of the total investment projects remain non-starter and just about 46 per cent of projects are under the implementation stage.

Amid other industrialized states, Rajasthan, Madhya Pradesh, Karnataka, West Bengal, Tamil Nadu and Jharkhand have recorded lower rates of implementation, highlighted the ASSOCHAM analysis.