Tamil Nadu tops Indian states in new investments in H1FY21: CARE Ratings
Tamil Nadu leads Indian states in attracting investments during the first half of FY21, having managed to grab 16 per cent of the funds that came into India during the period, according to CARE Ratings.
Andhra Pradesh garnered 11 per cent, Maharashtra, Rajasthan and Karnataka have garnered seven per cent each, while the balance went to the other states. Last year during the same period, Tamil Nadu took third spot, said CARE Ratings sourcing CMIE data, updated as on November 1, 2020.
On June 15 this year, the Maharashtra government announced signing of 12 memoranda of understanding (MOU) for investments worth Rs 20,000 crore. Similarly, 17 MOUs were signed for Tamil Nadu on May 27, 2020 out of which 14 were included in the data released by CMIE.
The Tamil Nadu Government said these MoUs worth Rs 10,055 crore. The state also said the State has been consistently positioned No. 1 in post-Covid investments during the first and second quarters. At the end of last month, foundation stones were laid for nine projects worth Rs 10,062 crore, and a job-generating potential of 17,000-18,000. Tamil Nadu topped fresh investments in the first quarter, according to Projects Today’s latest report on investment announcements in the July to September quarter. Karnataka was third in the list, followed by Gujarat and Maharashtra. Chhattisgarh's total investments in the quarter of Rs 35,771 crore were boosted by the Rs 22,653 crore Bodhghat irrigation project and public sector coal mining projects worth Rs 8,200 crore. Tamil Nadu received 132 projects worth Rs 23,332 crore in the same period. The CARE Ratings reports said all-India investments for new projects have been falling the past five years during April–September, save for H1FY19, when they rose 29% YoY to Rs 7.7 trillion from Rs 6 trillion in H1FY18. New projects announced for H1FY21 fell sharply by 69 per cent to Rs 1.5 trillion compared with Rs 4.8 trillion last year. This sharp fall was owing to the lack of economic activity due to the pandemic induced lockdown announced nationally in the last week of March 2020. As the enterprises were faced with Covid-19 induced challenges, they focussed on survival. Hence the decline in capex investments was somewhat expected, according to Care Ratings report. The fall in H1 FY21 was driven by an 81 per cent decline in projects announced by government. The new capex projects proposed by the government fell from Rs 3.2 trillion in H1FY20 to Rs 60,000 crore in H1 FY21. Similarly, investments proposed by the private sector fell by 45 per cent YoY to Rs 90,000 crore in H1 FY21 in comparison with Rs 1.6 trillion in the same period last year. In H1FY20, Andhra Pradesh had the highest share of 23 per cent in capex projects announced, totalling Rs 1.1 trillion, while in H1FY21, Tamil Nadu had the highest share of 16 per cent, amounting to Rs 20,000 crore.