Amid rising hope of an economic turnaround in India, investment in the country fell to a 14-year low in the month of December. The tracking database on fresh projects maintained by the Centre for Monitoring Indian Economy (CMIE) showed that new projects announced by the Indian companies were worth Rs 1 trillion in December-ended-quarter. This result is 53 percent lower than that announced in September-ended-quarter and 55 percent lower than the year-ago period.
The sequential decline in the capital expenditure announcements was led by the private sector where there was a sharp fall in private announcements on new projects. The new private sector projects were 62 percent lower in the December-ended-quarter when compared to the preceding quarter. It was 64 percent lower than December 2017 data.
Announcements in the public sector also saw a significant decline with fresh project announcements falling 37 percent on a quarter-on-quarter basis and 41 percent on a year-on-year basis to Rs 50,604 crore. It was at its lowest since December 2004.
All major sectors experienced this decline except for the construction sector which saw a marginal improvement in the December quarter.
Bad debts, rising uncertainties in policies ahead of polling season and a large number of stalled projects have been weighing on the Indian industry.