On New Year's eve, India lists out $1.4 trillion infrastructure projects it will be spending on in the next five years

  • Finance Minister Nirmala Sitharaman said that the government has shortlisted projects.
  • Centre will spend 39% of the investment, 39% will come from state governments, and the rest will come from private sector.
  • 43% of the projects are already in various stages are in various stages of implementation.
Hours before the year 2019 came to a close with horrid economic data, Finance Minister Nirmala Sitharaman said that the government has shortlisted infrastructure projects worth ₹102 lakh crores (over $1.4 trillion) that it will be spending on in the next five years. These announcements are likely to find allocations in the upcoming budget on February 1.

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This will be a big opportunity for construction companies like Larsen and Toubro, GMR Group, IRB Infrastructure, companies in the Adani Group, road construction companies Dilip Buildcon, Sadbhav Infra, cement majors like Ultratech, Shree Cement etc, to name a few. This will include projects of the India Railways and that will benefit stocks like Kalindee Rail, Texmaco, and Titagarh Wagons.

This is part of the promise made by the Prime Minister Narendra Modi at the peak of the election campaign. While the manifesto of the Modi-led political outfit, the Bharatiya Janata Party (BJP), lacked details, data showed that projects worth nearly half that amount, over $600 billion, are already in various stages of planning or implementation.

The money spent in each subsequent year, including the current one will be as follows:
FY20₹13.6 lakh crore
FY21₹19.5 lakh crore
FY22₹19 lakh crore
FY23₹13.8 lakh crore
FY24₹12.8 lakh crore

Sitharaman confirmed the same saying that, even according to the latest government estimate, 43% of the projects are already under various stages of implementation. "Centre will spend 39% of the investment, 39% will come from state governments, and the rest will come from private sector," she added.


An online dashboard will be set up for everyone to monitor the progress of each project. There will also be an annual supplementary report that will be released with updates on the projects.

The steps taken by the government have come at a time when economic growth has fallen to a six-year low, largely due to lack of risk appetite and credit flow in the private sector.


The minister said that a big part of the thrust now will be to improve financing for these projects including setting up of a financing institution as well as deepening India's bond market.

"The spending from the budget will also increase in consonance with the resources available," Atanu Chakraborty, the Secretary at the Department of Expenditure, said in a bid to assure the market that the fiscal deficit will remain under control. His 'broad' estimate is that by 2025, the expenditure on these projects will be 1.1% of GDP, which is a 'fairly doable outflow from the budget', according to him.




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