New Delhi: In the financial year 2016-17, fresh investments by the corporate sector hits 25-year low. The growth of total capital expenditure in terms of revenue by the nation’s top 1000 non-financial increased by just 5.8%.
According to Business Standard report, the growth of corporate investments is slowest since 1992.
Analysts blamed poor demand in the economy and banks’ reluctance to provide new loans for the slowest growth. Chokkalingam, Founder and Managing Director of Equinomics Research and Advisory said that Public Sector Banks (PSB) virtual freeze on fresh loans to risky projects.
Fresh investments by top 1000 companies in the last fiscal year were Rs 2.07 lakh crore whereas in FY 16 it was Rs 2.9 lakh crore in FY16. In FY14, it was an all-time high of Rs 5.7 lakh crore.
The capex growth registered by private sector companies is also the slowest in 12 years. Incremental capex by listed private companies was Rs. 1.1 lakh crore in the last fiscal year which is nearly half when compared to previous year.