Milestone in Outstanding Investments in India notch up Rs 100 lakh crore.

Outstanding investments in India crossed the Rs 100 lakh crore mark in the March 2010 quarter.

CMIE's CapEx database reveals that Indian corporates continue to announce fresh projects, even after commissioning huge capacities in the last few years. Projects worth Rs 6.5 lakh crore are scheduled for commissioning in 2010-11. This figure stood at Rs 2.3 lakh crore in 2007-08, Rs 2.9 crore in 2008-09, and Rs 4 crore in 2009-10.

The current investment boom is not triggered by any big push from the government. The chief growth driver is increasing demand, impelled by a sharp rise in corporate wages, salaries of government employees, and income of the farming community. The continuous flow of fresh investment announcements reflects the confidence of Corporate India that this growth in demand is sustainable.

The corporates are unlikely to face any problems in funding these projects, because there has been a handsome growth in domestic savings in the last eight years. Gross domestic savings as a proportion of GDP went up steadily from 23.5 per cent in 2001-02 to 36.4 per cent in 2007-08.

The Indian economy is expected to return to its nine per cent growth trajectory after a two-year blip. We expect the real GDP to grow by 9.2 per cent in 2010-11, as compared to an estimated 7.1 per cent in 2009-10. All three broad sectors of the economy are projected to do well. The industrial sector is projected to grow by 9.6 per cent, services by 9.8 per cent, and the agriculture and allied sector by 5.8 per cent.

For fiscal 2010-11, inflation as measured by the wholesale price index (WPI) is projected at six per cent, as compared to the 3.6 per cent estimated for fiscal 2009-10.