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Private Corporate Investment in 2019-20: Some Signs of Improvement

This article analyses data on investment intentions of the private corporate sector in India during 2018-19 and 2019-20 and finds signs of improvement in the envisaged capital expenditure (capex) for the year 2019-20 based on the projects already sanctioned/contracted previously across different channels of financing. The total cost (in terms of value) of projects sanctioned/contracted through the major channels of financing can provide lead information about the near term momentum of investment activity and in the current context of weak private investment demand in the economy, this article highlights likely beginning of a turnaround in the investment cycle.

Introduction

Economic growth hinges on private investments. In the growth literature, investment has been regarded as one of the primary engines of growth. Investment, as a key component of GDP, can also influence labour productivity, capacity creation, introduction of new technology, employment generation, etc., and accordingly, could provide early indication about the growth outlook. Thus, for short to medium-term economic analysis and forecasting purposes, timely information on capital expenditure (capex) is vital. However, hard data on private investments from published annual accounts of companies comes with a considerable time lag and, therefore may not be very useful for short-term analysis. Thus, countries often use survey-based methods to generate information on envisaged corporate investments (Abberger, 2005; Aurizio and Stefano, 2011; Barnes and Ellis, 2005; Ferrari, 2005; Osterholm, 2013). The survey-based results offer a valuable tool for the assessment of both current investment behaviour and investment intentions that are likely to materialise in the short-term.

Following international best practices, efforts have been geared towards conducting surveys in India also since the late 1980s for the assessment and forecasting of the investment intentions. Since 1970s, the Reserve Bank of India has been tracking capex plans of the private corporate sector (projects that are already funded by financial institutions) for providing an outlook on investment intentions based on the methodology adopted by Rangarajan (1970) on time phasing of capex. Such articles were published initially in the Economic and Political Weekly and subsequently (since 1989) in the RBI Bulletin.

The primary source of data on investment intentions are the financiers of capex projects, viz., banking sector and financial institutions (FIs)1 as well as external commercial borrowings (ECBs)2, foreign currency convertible bonds (FCCBs), rupee denominated bonds (RDBs) and initial public offerings (IPOs), follow-on public offerings (FPOs), and rights issues for a year.

This article delves into the investment intentions of the private corporate sector during 2018-19 and 2019-20 captured from their project implementation plans. The article is structured into six sections. Section II sets out the methodology and its limitations. Section III addresses the characteristics of projects sanctioned or contracted during the period of review, funding thereof, distributional aspects in terms of regions and industries. Section IV deals with the phasing profile of the sanctioned/contracted loans/ financing and estimates the growth of corporate investment. Section V presents an analysis of private placements and foreign direct investment made during the year. Section VI concludes the study.

II. Methodology

The short-term (one-year ahead) forecasting of capex based on time phasing of corporate projects financed by financial institutions was pioneered by Dr. C. Rangarajan in 1970. For the estimation of capex under this methodology, data on projects sanctioned are obtained from banks/FIs, supplemented with data on finances raised through other sources such as ECBs/FCCBs/IPOs/FPOs/rights issues. Based on ex ante phasing plans furnished by the companies at the time of appraisal, an estimate of the likely level of capex that would have been made during the year is obtained.

In this analysis, due care has been taken to ensure that each project enters the information set only once, even if it is financed through multiple channels by using databases internal to the RBI as well as information provided by the Securities and Exchange Board of India (SEBI). Projects not financed through any of the aforementioned channels or of a size lower than ₹10 crore are not covered. Projects with private ownership below 51 per cent or undertaken by trusts, Central and State governments, and educational institutions are also excluded.

The estimates are obtained based on the assumption that companies adhere to their ex ante expenditure plans. However, these estimates digress in scope and methodology from the ex post estimates of corporate fixed investment available in the National Accounts Statistics (NAS) in view of the possibility that some ex ante intentions may not fructify into realised investment in terms of their amount and timing of investment.

III. Characteristics of Projects Sanctioned / Contracted

During 2018-19, banks and FIs sanctioned 414 project proposals of the private companies with a total cost of ₹1,76,581 crore. There are 535 companies, which did not avail of any financing from the banks/FIs, but contracted loan amount of ₹76,515 crore through ECBs/FCCBs. Similarly, 39 companies did not avail of any bank finance or ECBs/FCCBs but raised ₹609 crore for their capex needs through domestic equity issues. Altogether, investment plans of 988 projects were made during 2018-19 aggregating to ₹2,53,705 crore as against 955 projects with investment intentions totalling ₹2,07,673 crore in 2017-18 (Annex: Table A1-A4).

The size-wise distribution of the projects describes how the cost of individual projects, sanctioned in a particular span of time, are distributed. The empirical results reveal that the statistical distribution of project cost carries a heavy right-tail. The average cost of projects sanctioned in a period tends to be driven by the nature and profile of this tail reflecting the relative presence of outliers (large values). The size-wise distribution of projects showed a marginal increase in the number of mega projects (₹5,000 crore & above) from three in 2017-18 to five in 2018-19 along with an increase in their combined share in the total project cost. This partly contributed to the rise in the total project cost in 2018-19, which otherwise witnessed a decline in the total number of projects in 2018-19 vis-à-vis 2017-18. Mega projects generally run over a longer span of time, as reflected in their phasing plan, and the presence of such projects boost the total cost of projects sanctioned in a year. There were 40 large projects of size ₹1,000 crore-₹5,000 crore with a combined share of around 41 per cent in the total project cost (Box 1 and Annex: Table A5).

A look at the purpose-wise pattern of projects indicates that investment in green field (new) projects occupied the largest share (76.9 per cent) in the total cost of projects sanctioned by banks and FIs during 2018-19, followed by expansion and modernisation of existing projects constituting 19.7 per cent of the total project cost, which is an increase in its share vis-à-vis 2017-18 (Annex: Table A6).

Box 1: Statistical Distribution of Project Cost

The aggregate cost of projects sanctioned in a particular time period is jointly influenced by the number of projects and their individual amounts. As indicated in the earlier section, projects with cost of ₹10 crore and above are only reported by the entities, and therefore, information on very small projects (of less than ₹10 crore) is not captured in the dataset.

To study the profile (in terms of size), the set of all 2,112 projects sanctioned by the banks/FIs during the 5-year period (2014-15 to 2018-19) was considered. The results reveal that the statistical distribution of project cost is highly skewed (asymmetrical) with a heavy (thick) right tail having an arithmetic mean of ₹332.91 crore, which is larger than its 75th percentile. The distribution shows that around 30 per cent of the projects were of the cost ranging from ₹10 crore to less than ₹30 crore. The last 5 per cent of observations lie in the wide range of ₹1,480 crore to ₹15,000 crore, reflecting existence of low frequency and varied-sized large projects (Table B1 and Chart B1).

The fitting of the distribution of the dataset of project cost identified that the 3-parameter lognormal distribution describes the dataset appropriately. The probability density function of a 3-parameter lognormal distribution is defined as:

wherein, γ, μ and σ are the three parameters of the distribution. The distribution transforms to the traditional 2-parameter lognormal distribution with γ=0.

Chart B1: Fitted Distribution of Cost of Project

Table B1: Descriptive Statistics of Project Cost-size
Number of Projects 2112 25th Percentile (Q1) 24.43
Mean 332.91 Median (Q2) 69.04
Standard deviation 880.64 75th Percentile (Q3) 278.72
Minimum 10.00 95th Percentile 1480.00
Maximum 15000.00 Skewness 7.93
Range 14990.00 Kurtosis 94.66

Estimated parameters of the lognormal distribution with the estimated parameter could be useful in assessing the profile of the project cost and in computing various relevant probabilities (e.g. probability that a particular project cost will fall in a particular band). Three test statistics viz, Kolmogorov-Smirnov, Anderson-Darling and Chi-Square confirm appropriateness of the lognormal distribution in describing the nature of the distribution of cost of projects (Table B2). Further, the probability-probability (PP) plot, exhibiting a straight line at an angle of 45o, reconfirms the log-normality of the distribution of the project cost (Chart B2).

Further, having identified and established the appropriateness of the said distribution, it would be desirable to estimate the parameters in order to describe subsets of this dataset, which are expected to be more homogeneous. For example, the 3-parameter lognormal distribution was fitted to two data subsets – split by location (viz., single-state and multi-states). The fitting and estimated parameters reveal differential characteristics of projects by location. The average size of the project cost in multi-state projects was larger than that of the single-state projects. However, the former are found to be less skewed and less leptokurtic (peaked).

Table B2: Estimates of Parameters and Test Statistics for Goodness of Fit
Parameter Estimates Test Statistics
γ 9.9083 Kolmogorov-Smirnov (KS) 0.029
µ 4.1071 Anderson-Darling (AD) 2.799
σ 1.9516 Chi-Square 39.665
Note: The Kolmogorov-Smirnov, Anderson-Darling and Chi-Square tests are used for testing goodness of fit, i.e. how well the chosen theoretical distribution fits the underlying dataset.

An analysis of the profile of infrastructure sector projects relative to non-infrastructure sector projects suggests that the share of infrastructure sector projects, led by power, roads and airports, has broadly been within the range of about 50 per cent to 70 per cent (by amount), although in terms of the number of projects share constitute about 30 per cent. The median sizes of the infrastructure and non-infrastructure projects, using the estimated lognormal distribution were computed as ₹283.87 crore and ₹40.30 crore respectively, which are comparable with the empirical data.

Table B3: Descriptive Statistics of Project Cost-size by location
Statistics Multi-state Single-state
Number of Projects 72 2040
Mean 1001.80 309.30
Standard deviation 1284.20 853.89
Median 396.22 65.44
Skewness 2.43 8.61
Kurtosis 10.99 108.82
Fitting of 3-parameter lognormal
γ 12.2740 9.9044
µ 5.9003 4.0432
σ 1.7007 1.9293

Chart B2: PP-Plot

Table B4: Descriptive Statistics of Project Cost-size by Infrastructure / Non-Infrastructure
Statistics Infrastructure Non-Infrastructure
Number of Projects 661 1451
Mean 622.14 201.15
Standard deviation 1084.00 733.93
Median 283.87 40.30
Skewness 5.66 11.02
Kurtosis 52.25 167.65
Fitting of 3-parameter lognormal
γ 5.3906 9.8992
µ 5.4444 3.5443
σ 1.5423 1.7773

Industry-wise, the infrastructure sector, comprising (i) power, (ii) telecom, (iii) ports and airports, (iv) storage and water management, (v) Special Economic Zone (SEZ), industrial, biotech and IT park, and (vi) roads and bridges, recorded a surge in its share to 58.5 per cent in 2018-19 from 51.8 per cent in 2017-18, despite significant fall in the share of its largest component, viz., ‘power sector’.

‘Ports and airports’ have witnessed a remarkable surge in aggregate cost of projects sanctioned by banks/ FIs. Out of 5 projects sanctioned in 2018-19, four were ‘new’ and one was for ‘expansion and modernisation’.

Chart 1: Share of Major Industries in Aggregate Cost of Projects Sanctioned by Banks/FIs

The share of ‘cement’ projects in the aggregate project cost, which rose sharply from a meagre 0.6 per cent in 2017-18 to 5.7 per cent in 2018-19, may facilitate the infrastructure sector to expand in the forthcoming years. Total project cost (and number of projects) in “cement’ industry rose markedly from ₹1,068 crore in 2017-18 to ₹10,138 crore in 2018-19 (from three to eleven projects respectively). Out of these eleven projects sanctioned in 2018-19, eight were ‘new’ and three were for ‘expansion and modernisation’. However, industry groups like ‘metal and metal products’; and ‘construction’ demonstrated lacklustre momentum in activities in 2018-19 as revealed from their significant reduction in aggregate project cost as well as number of projects and this slippage is likely to impact the growth for some time. Among other important industries, while the share of ‘mining and quarrying’ witnessed a remarkable surge, the share of ‘chemical and chemical products’ slipped. Aggregate project cost as well as the number of projects increased for ‘mining and quarrying’ with four ‘new’ projects and two other projects for ‘expansion and ‘modernisation’ (Chart 1 and Annex: Table A7).

The deciding factors for the location of a project are accessibility of raw materials, availability of skilled labour, adequate infrastructure, market size, and growth prospects. Data for the last five years (2014-15 to 2018-19) revealed that 56 per cent of the projects were taken up in six states, viz., Andhra Pradesh, Gujarat, Karnataka, Maharashtra, Rajasthan and Tamil Nadu indicating their locational advantages over other states (Chart 2a).

Chart 2a: State-wise Distribution of ProjectsSanctioned During 2014-15 to 2018-19

Chart 2b: State-wise Distribution of ProjectsSanctioned During 2009-10 to 2013-14

The spread of projects encompassing more than one state has declined significantly during the quinquennial period of 2014-19 over the quinquennial period of 2009-14. This is partly due to lower share of multi-state mega projects (project cost of ₹5,000 crore and more) in total number of mega projects. Only one out of fifteen mega projects (6.67 per cent) sanctioned during 2014-19 had spread across multi-states, as against nine multi-state projects out of 63 mega projects (14.29 per cent) sanctioned during 2009-14 (Chart 2a and Chart 2b).

In 2018-19, Andhra Pradesh accounted for the highest share (11.8 per cent) in total cost of projects sanctioned by banks/FIs followed by Tamil Nadu (11.5 per cent), Maharashtra (10.9 per cent), Gujarat (9.9 per cent), Telangana (8.2 per cent), Rajasthan (6.8 per cent) and Uttar Pradesh (6.2 per cent). States like Maharashtra and Karnataka registered a marked fall in their share from the previous year. On the other hand, Telangana recorded significant gains in their share followed by Tamil Nadu and Uttar Pradesh (Chart 3 and Annex: Table A8).

IV. Phasing Profile of Investment Intentions

The information on the phasing profile of envisaged capex from the cohorts of projects sanctioned during different years helps short-term (one year) forecasting of capex. The phasing from the cohort of projects sanctioned by the banks/FIs in 2018-19 indicates that around 35 per cent (₹62,561 crore) of the total proposed expenditure would be spent in 2018-19, 30 per cent (₹53,351 crore) in 2019-20 and another 24 per cent (₹42,281 crore) in the subsequent years. Around 11 per cent of total cost of the projects sanctioned in 2018-19 was already spent during 2015-16 to 2017-18 (Annex: Table A1).

Chart 3: Share of Major States in Aggregate Cost of Projects Sanctioned by Banks/FIs

From the planned expenditure, the aggregate capex envisaged in 2018-19 showed an increase over the previous year despite a fall in the number of sanctions by banks/FIs. In 2018-19, capex planned to be incurred from resources raised through international bond markets increased sharply by around 133 per cent from its level a year ago. The capital market (equity route) enabled financing of envisaged capex of ₹1,179 crore in 2018-19, which was significantly lower than in the previous year (Annex: Table A1, A2, A3).

To sum up, it is assessed that a total capex (from all channels) of ₹1,96,312 crore (of which, ₹1,11,710 crore was from fresh sanctions during the year) would have been incurred by the private corporate sector in 2018-19, translating into a substantial improvement by around 24 per cent. This improvement can be mainly attributed to ECB channel of capex financing. To add to it, the planned capex based on the pipeline projects3 (already sanctioned in preceding years) is poised to be high at around ₹1,20,157 crore in 2019-20, marking a significant improvement over the previous year (₹84,602 crore) (Annex: Table A2, A4).

Going forward, the aggregate envisaged capex in 2019-20 would also be contingent upon the level of corporate investment in 2019-20 from the new cohort of projects getting sanctioned in 2019-20. The envisaged capex from the major channels of financing may further improve driven by higher amount sanctioned/contracted in the first half of 2019-20 over first half of 2018-19. The total project cost sanctioned by banks and financial institutions also increased markedly from ₹86,607 crore to ₹1,25,305 crore. Total loan amount contracted for capex purpose through the ECB channel increased significantly from ₹39,833 crore to ₹61,833 crore (Table 1).

Table 1: Projects Funded through Banks/FIs/ECBs/ FCCBs/RDBs/IPOs*
  H1:2019-20 H1:2018-19
Number of projects Amount sanctioned/ contracted (in ₹ crore) Number of projects Amount sanctioned/ contracted (in ₹ crore)
Banks/FIs 142 1,25,305 193 86,607
ECBs/FCCBs/RDBs 272 61,833 262 39,833
IPOs 9 78 30 481
Total 423 1,87,216 485 1,26,921
*Provisional data.

V. Corporate Investment Financed by Private Placements and Foreign Direct Investment

In recent years, debt instruments like bonds and debentures and foreign direct investment (FDI) have assumed prominence as alternative sources of capex financing. Mobilisation of funds through private placement of debt (bonds and debentures) rose substantially during the period from 2013-14 to 2016-17 but moderated during 2017-18 and 2018-19. Preference for FDI as an alternative source of capex financing is also observed, with an upsurge in FDI amount from 2012-13 to 2016-17. Thereafter, it subsided in 2017-18 but rose again in 2018-19. The rise in FDI inflows continued in the first half of 2019-20 as compared to the corresponding period of the previous year (Table 2).

Table 2: Private Placements and FDI (in ₹ crore)
Period Debt-Private Placements* Foreign Direct Investments**
2011-12 27,040 1,65,146
2012-13 59,188 1,21,907
2013-14 56,042 1,47,518
2014-15 97,358 1,81,682
2015-16 1,17,394 2,62,322
2016-17# 1,53,136 2,91,696
2017-18# 1,35,988 2,88,889
2018-19# 1,34,540 3,09,867
H1:2019-20# 51,068 1,82,000
(H1:2018-19)# (55,022) (1,55,117)
*: Only for the manufacturing and services companies in the private sector
**: FDI inflows includes equity capital only.
#: Provisional Data.
Source: Prime Database and Government of India.

VI. Conclusion

This article uses data on investment intentions of firms to assess the outlook for investment activity in 2019-20. The phasing profile of financing for projects sanctioned /contracted helps generate forward looking assessment of likely investment to be undertaken in the near term. This article demonstrates existence of heavy right tail in the distribution of project cost. It finds that a lognormal distribution could describe this positive skewness in project cost data appropriately and, therefore, could be useful in exploring future research on the subject.

High value and mega projects sanctioned/ contracted during a particular year affects the phasing profile of the cohort of projects. The number of new mega projects, sanctioned by banks/FIs, has been small since 2011-12 in the aftermath of global financial crisis of 2008-09. However, it is noteworthy that projects, which were already announced and implemented prior to/around the global financial crisis, got higher financial capital from multiple sources to execute sanctioned investment plans.

The planned or envisaged capex from all sources based on the pipeline projects sanctioned in all preceding years points to a noticeable improvement in 2019-20. The investment cycle appears to be poised to gain momentum in the short to medium term, but, its sustainability needs to be watched closely.

References

Abberger, K (2005), “The Use of Qualitative Business Tendency Surveys for Forecasting Business Investment in Germany”, ifo Working Paper No. 13, June

Aurizio, L. D. and Stefano, I. (2011), “Investment Forecasting with Business Survey Data”, Working Paper Number 832, November, Bank of Italy.

Barnes, S. and Ellis, C. (2005), “Indicators of short-term Movements in Business Investment”, Bank of England, Quarterly Bulletin, Spring, 30-38.

Ferrari, N (2005), “Forecasting corporate investment-An indicator based on revisions in the French Investment survey”, DESE Working Paper, October.

Osterholm, P. (2013), “Forecasting Business Investment in the Short Term Using Survey Data”, Working Paper, Number 131, November, National Institute of Economic Research.

Rangarajan, C. (1970), “Forecasting Capital Expenditure in the Corporate Sector”, Economic and Political Weekly, December 19.

Reserve Bank of India: Various data releases and other publications.


Annex

Table A1: Phasing of Capex of Projects Sanctioned by Banks/FIs
Year of sanction ↓ No. of Projects Project Cost in the Year of Sanction(in ₹ crore) Project Cost due to Revision/ Cancella- tion@(in ₹ crore) 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Beyond 2019-20
1 2 3 4 5 6 7 8 9 10 11 12 13 14
Up to                            
2010-11       3,13,583 2,23,698 1,23,259 58,668 11,938 118 869        
2011-12 636 2,12,002 1,91,592 (9.6) 23,005 66,915 55,384 28,190 9,470 2,926          
2012-13 414 1,96,345 1,89,483 (3.5) 82 36,664 56,725 48,976 27,325 11,219 6,447 2,045      
2013-14 472 1,34,019 1,27,328 (5.0)   1,332 15,139 34,769 44,925 19,909 7,105 2,677 1,472    
2014-15 326 87,601 87,253 (0.4)     98 14,822 34,589 25,765 9,535 1,246 162 1,036  
2015-16 346 95,371 91,781 (3.8)       3,787 7,434 37,517 28,628 8,079 4,964 1,152 220
2016-17 541 1,82,807 1,79,249 (2.0)       1,352 3,952 25,388 71,186 41,075 21,643 8,566 6,087
2017-18 485 1,72,831 1,68,239 (2.6)         620 15,184 12,445 63,001 41,436 22,767 12,786
2018-19 414 1,76,581             569 6,847 10,972 62,561 53,351 42,281
Total#       3,36,670 3,28,609 2,50,605 1,90,564 1,40,253 1,38,595 1,43,062 1,29,095 1,32,238 86,872 61,374
Percentage change         -2.4 -23.7 -24.0 -26.4 -1.2 3.2 -9.8 2.4 *  
#: Column totals indicate envisaged capex in a particular year covering the projects which received financial assistance in various years. The estimate is ex ante, incorporating only envisaged investment. They are different from those actually realized/utilised.
*: Per cent change for 2019-20 is not worked out as capex from proposals that are likely to be sanctioned in 2019-20 is not fully available.
@: Figures in bracket are percentage of revision/cancellation.

Table A2: Phasing of Capex Projects* Funded Through ECBs/FCCBs/RDBs**
Loans contracted in ↓ No. of Companies Total loan contracted
(in ₹ crore)
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Beyond 2019-20
1 2 3 4 5 6 7 8 9 10 11 12 13
Up to                          
2010-11     31,829 13,130 2,873 500              
2011-12 438 40,012   25,212 12,800 1,900 100            
2012-13 519 65,692     37,792 20,267 6,300 1,333          
2013-14 563 80,736       56,197 20,976 3,563          
2014-15 478 57,327         36,791 16,806 3,151 575 2 2  
2015-16 314 38,885           28,998 7,311 2,572 4    
2016-17 346 22,154             14,953 6,005 1,192 2 2
2017-18 419 37,896               17,822 13,054 6,484 536
2018-19 535 76,515                 48,643 25,706 2,166
Total&     31,829 38,342 53,465 78,864 64,167 50,700 25,415 26,974 62,895 32,194 2,704
Percentage change       20.5 39.4 47.5 -18.6 -21.0 -49.9 6.1 133.2 #  
*: Projects which did not receive assistance from banks/FIs.
**: Rupee Denominated Bonds (RDBs) have been included since 2016-17.
#: Per cent change for 2019-20 is not worked out as capex from proposals that are likely to be drawn in 2019-20 is not fully available.
&: The estimate is ex ante, incorporating only envisaged investment, they are different from those actually realised/utilised.

Table A3: Phasing of Capex of Projects Funded Through Equity Issues*
Equity issued during↓ No. of Companies Capex Envisaged
(₹ crore)
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Beyond 2019-20
1 2 3 4 5 6 7 8 9 10 11 12 13
Up to                          
2010-11     1,923 726 95                
2011-12 21 973 153 460 360                
2012-13 25 1,135     533 494 108            
2013-14 21 454         384 70          
2014-15 24 1,078         189 557 332        
2015-16 40 4,511         11 644 2,753 849 183 71  
2016-17 29 1,159           14 471 368 163 143  
2017-18 51 1,538               419 327 787 5
2018-19 39 609                 506 90 13
Total&     2,076 1,186 988 494 692 1,285 3,556 1,636 1,179 1,091 18
Percentage change       -42.9 -16.7 -50.0 40.0 85.7 176.9 -54.0 -27.9 #  
* : Projects which did not receive assistance from banks/FIs/ECBs/FCCBs/RDBs.
#: Per cent change for 2019-20 is not worked out as capex from proposals that are likely to be implemented in 2019-20 is not fully available.
& : The estimate is ex ante, incorporating only envisaged investment, they are different from those actually realised/utilised.

Table A4: Phasing of Capex of Projects Funded Through Banks/FIs/IPOs/ECBs/FCCBs/RDBs*/IPOs
Year of sanction ↓ No. of Companies Project Cost
(₹ crore)
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Beyond 2019-20
Banks/ FIs, ECBs/ FCCBs/ RDBs/ IPOs
1 2 3 4 5 6 7 8 9 10 11 12 13
Upto                          
2010-11     3,47,335 2,37,554 1,26,227 59,168 11,938 118 869 0 - - -
2011-12 1,095 2,32,577 23,158 92,587 68,544 30,090 9,570 2,926 - - - - -
2012-13 958 2,56,310 84 36,664 95,050 69,737 33,733 12,552 6,447 2,045 - - -
2013-14 1,056 2,08,518 - 1,332 15,139 90,966 66,285 23,542 7,105 2,677 1,472 - -
2014-15 828 1,45,658 - - 98 14,822 71,569 43,128 13,018 1,821 164 1,038 -
2015-16 700 1,35,177 - - - 3,787 7,445 67,159 38,692 11,500 5,151 1,223 220
2016-17 916 2,02,562 - - - 1,352 3,952 25,402 86,610 47,448 22,998 8,711 6,089
2017-18 955 2,07,673 - - - - 620 15,184 12,445 81,242 54,817 30,038 13,327
2018-19 988 2,53,705 - - - - - 569 6,847 10,972 1,11,710 79,147 44,460
Total&     3,70,577 3,68,145 3,05,058 2,69,922 2,05,112 1,90,580 1,71,164 1,57,705 1,96,312 1,20,157 64,096
Percentage change       -0.7 -17.1 -11.5 -24.0 -7.1 -10.2 -7.9 24.5 #  
*: Rupee Denominated Bonds (RDBs) have been included since 2016-17.
#: Per cent change for 2019-20 is not worked out as capex from proposals that are likely to be sanctioned in 2019-20 is not fully available.
&: The estimate is ex ante, incorporating only envisaged investment, they are different from those actually realised/utilised.

Table A5: Size-wise Distribution of Projects Sanctioned by Banks/FIs: 2009-10 to 2018-19
Period Less than ₹100 crore ₹100 crore to ₹500 crore ₹500 crore to ₹1000 crore ₹1000 crore to ₹5000 crore ₹5000 crore & above Total
2009-10 No. of Projects 439 189 40 39 22 729
  Per cent Share 3.8 11.0 6.8 20.8 57.5 100 (4,09,502)
2010-11 No. of Projects 412 172 42 51 20 697
  Per cent Share 4.4 10.2 8.6 29.3 47.5 100 (3,75,176)
2011-12 No. of Projects 420 145 36 26 9 636
  Per cent Share 8.3 17.0 13.7 27.6 33.4 100 (1,91,592)
2012-13 No. of Projects 245 119 20 23 7 414
  Per cent Share 4.8 14.6 7.3 26.8 46.4 100 (1,89,483)
2013-14 No. of Projects 306 115 25 21 5 472
  Per cent Share 8.3 20.0 13.9 29.1 28.7 100 (1,27,328)
2014-15 No. of Projects 223 65 18 19 1 326
  Per cent Share 9.0 16.6 14.6 47.8 12.0 100 (87,253)
2015-16 No. of Projects 214 76 34 21 1 346
  Per cent Share 8.6 20.9 26.0 38.5 5.9 100 (91,781)
2016-17 No. of Projects 287 180 29 40 5 541
  Per cent Share 5.8 23.3 11.9 41.7 17.4 100 (1,79,249)
2017-18 No. of Projects 263 149 28 42 3 485
  Per cent Share 5.2 21.0 10.8 43.9 19.1 100 (1,68,239)
2018-19 No. of Projects 215 115 39 40 5 414
  Per cent Share 4.3 15.8 15.3 41.1 23.5 100 (1,76,581)
Note: i. Figures in bracket are total cost of projects in ₹ crore.
ii. Per cent share is the share in total cost of projects.

Table A6: Purpose-wise Distribution of Projects Sanctioned by Banks/FIs: 2010-11 to 2018-19
Period Number and Share of Projects New Expansion & Modernisation Diversification Others Total
2010-11 No. of Projects 454 224 6 13 697
  Per cent Share 66.8 30.9 1.8 0.5 100 (3,75,176)
2011-12 No. of Projects 449 172 5 10 636
  Per cent Share 70.6 23.1 0.1 6.3 100 (1,91,592)
2012-13 No. of Projects 303 107 - 4 414
  Per cent Share 84.2 14.7 - 1.1 100 (1,89,483)
2013-14 No. of Projects 361 95 2 14 472
  Per cent Share 65.2 20.1 - 14.7 100 (1,27,328)
2014-15 No. of Projects 203 92 2 29 326
  Percent Share 39.4 14.7 0.2 45.7 100 (87,253)
2015-16 No. of Projects 260 64 3 19 346
  Per cent Share 73.6 14.3 0.1 12.0 100 (91,781)
2016-17 No. of Projects 429 97 4 11 541
  Per cent Share 78.6 9.9 0.1 11.3 100 (1,79,249)
2017-18 No. of Projects 396 80 2 7 485
  Per cent Share 89.0 9.4 0.1 1.5 100 (1,68,239)
2018-19 No. of Projects 320 78 - 16 414
  Per cent Share 76.9 19.7 - 3.4 100 (1,76,581)

Note: i. Figures in bracket are total cost of projects in ₹ crore.
ii. Per cent share is the share in total cost of projects.
iii. - : Nil/ Negligible.


Table A7: Industry-wise Distribution of Projects Sanctioned by Banks/FIs: 2009-10 to 2018-19
Industry 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19
Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share
Infrastructure 100 48.9 121 53.7 107 47.4 82 47.9 87 39.8 74 48.8 108 72.0 204 62.6 150 51.8 125 58.5
i) Power 75 30.7 105 46.3 82 42.4 71 39.4 70 35.1 65 42.2 92 57.1 170 45.4 117 36.5 81 25.1
ii) Telecom 6 16.4 2 5.7 1 0.0 2 5.6 1 0.0 1 4.9 1 0.3 1 0.0 - - - -
iii) Ports & Airports 2 0.3 1 0.7 1 1.3 1 1.9 1 0.8 - - 3 2.4 8 5.7 6 3.1 5 14.6
iv) Storage & Water Management 2 0.9 1 0.0 12 0.5 - - 5 1.1 2 0.6 4 4.2 6 3.7 2 0.4 15 5.3
v) SEZ, Industrial, Biotech and IT Park 15 0.6 12 1.1 11 3.2 8 0.9 8 1.5 3 0.9 1 0.4 2 0.4 9 1.6 6 2.2
vi) Roads & Bridges - - - - - - - - 2 1.2 3 0.3 7 7.6 17 7.3 16 10.1 18 11.3
Chemicals & Fertilizers 28 0.8 27 1.3 17 3.5 19 1.1 15 1.0 7 2.6 11 1.6 10 2.1 23 11.4 20 6.6
Cement 29 2.8 15 2.7 9 2.0 11 3.9 12 7.1 7 3.8 5 1.9 5 2.3 3 0.6 11 5.7
Mining & Quarrying 9 3.4 1 0.2 4 0.2 2 0.1 1 0.6 2 0.1 10 2.7 4 0.4 1 0.0 7 5.0
Textiles 77 2.2 77 2.9 94 7.0 31 1.9 58 10.3 50 4.1 49 4.8 57 4.1 54 3.7 29 4.2
Metal & Metal Products 134 18.1 113 21.1 73 16.3 51 28.9 44 17.0 17 17.4 14 1.5 23 4.9 21 9.7 15 2.7
Rubber Products 15 0.4 19 0.5 18 0.9 7 0.5 9 0.3 8 0.8 4 0.5 8 0.2 10 2.5 6 2.5
Construction 20 11.5 18 3.3 23 1.8 20 2.8 27 2.1 29 4.0 26 1.8 60 12.0 39 5.3 28 2.5
Hospitals 23 0.9 22 0.6 9 0.3 17 1.4 10 0.7 2 0.1 1 0.0 22 1.1 18 1.8 15 2.3
Hotel & Restaurants 56 2.6 63 3.5 51 4.6 31 3.1 29 2.7 15 1.1 16 1.1 12 0.8 29 2.9 28 1.7
Pharmaceuticals 31 0.5 18 0.3 20 0.8 10 0.4 19 1.3 9 1.5 11 0.3 12 1.1 15 0.6 23 1.5
Food Products 41 0.5 39 0.7 41 1.5 36 0.9 43 1.8 34 2.9 26 1.8 38 0.9 47 2.8 28 1.3
Other Services 2 0.0 3 0.1 4 0.1 2 0.1 8 0.8 2 0.1 - - 3 0.1 - - 11 1.2
Other Manufacturing 18 0.5 22 0.2 22 0.4 8 0.1 15 0.7 7 0.1 9 1.4 7 0.2 9 0.7 20 0.7
Transport Equipment 25 1.3 27 0.8 26 2.6 17 0.9 16 1.2 7 5.3 4 2.5 9 3.6 10 0.3 5 0.7
Others* 121 5.6 112 8.2 118 10.5 70 5.7 79 12.6 56 7.3 52 6.0 67 3.6 56 5.9 43 3.0
Total 729 100 697 100 636 100 414 100 472 100 326 100 346 100 541 100 485 100 414 100
Total cost of projects (₹ crore) 4,09,502 3,75,176 1,91,592 1,89,483 1,27,328 87,253 91,781 1,79,249 1,68,239 1,76,581
* : Comprise industries like Agricultural & related activities, Paper & Paper products, Printing & Publishing, Rubber, IT Software, Communication, Trading of services, Entertainments, etc.
- : Nil/Negligible.
Note: Per cent share is the share in total cost of project.


Table A8: State-wise Distribution of Projects Sanctioned by Banks/FIs: 2009-10 to 2018-19
State 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19
Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share Num ber of Pro jects Per cent Share
Andhra Pradesh 73 7.1 65 11.4 52 5.1 35 5.7 37 4.0 24 8.1 33 12.3 47 8.0 22 9.9 29 11.8
Tamil Nadu 66 5.5 93 6.1 58 5.7 22 1.8 33 5.4 27 2.9 26 9.3 22 4.4 28 6.6 33 11.5
Maharashtra 117 10.0 71 7.4 86 19.1 67 10.7 76 19.7 38 14.8 36 9.4 57 8.8 65 23.3 37 10.9
Gujarat 69 3.2 65 9.6 75 9.0 58 5.6 66 14.5 71 9.5 61 15.1 102 23.0 71 8.0 55 9.9
Telangana - - - - - - - - - - - - 10 3.8 52 6.8 17 1.9 25 8.2
Rajasthan 23 2.9 28 0.8 49 4.9 41 5.3 24 1.4 29 11.1 10 0.9 23 2.8 33 6.3 20 6.8
Uttar Pradesh 27 0.4 32 4.6 42 7.8 26 4.4 21 1.1 20 5.4 15 2.3 22 3.7 30 2.4 29 6.2
Karnataka 42 1.4 40 7.2 39 12.0 20 1.6 39 6.2 27 5.4 21 6.2 52 6.8 64 9.6 33 4.7
Punjab 23 0.4 38 1.1 37 1.7 12 10.9 28 1.5 6 0.3 11 1.7 29 2.1 31 2.2 14 1.8
West Bengal 33 2.6 29 3.3 19 4.9 13 1.0 12 1.2 9 1.3 14 3.1 18 1.7 14 1.8 15 1.6
Madhya Pradesh 23 4.2 21 5.2 16 5.6 13 3.9 30 6.1 14 3.9 21 6.9 18 7.5 10 0.7 11 1.4
Odisha 25 13.9 25 7.4 15 6.3 10 26.8 10 11.7 5 15.9 6 3.1 6 3.1 5 3.0 9 1.3
Chhatisgarh 23 6.0 31 12.1 11 2.4 9 4.1 16 10.7 8 7.4 8 4.7 15 4.0 7 4.8 5 0.8
Jammu & Kashmir 2 0.1 3 0.1 5 0.2 10 0.2 10 5.2 2 0.1 9 0.2 3 0.1 8 2.0 12 0.4
Himachal Pradesh 19 0.6 13 0.8 7 0.5 5 0.3 3 1.8 3 0.1 8 1.4 1 0.0 8 2.3 7 0.3
Multiple# 45 29.0 48 16.2 34 4.5 15 7.7 21 6.9 10 9.5 13 13.5 17 11.8 16 7.5 16 10.0
Others* 119 12.7 95 6.7 91 10.3 58 10.0 46 2.6 33 4.3 44 6.1 57 5.4 56 7.7 64 12.4
Total 729 100 697 100 636 100 414 100 472 100 326 100 346 100 541 100 485 100 414 100
Total cost of projects (₹ crore) 4,09,502 3,75,176 1,91,592 1,89,483 1,27,328 87,253 91,781 1,79,249 1,68,239 1,76,581
#: Comprise projects over several States.
*: Comprise remaining States / Union Territories.
‘ -’ information not available.
Note: Per cent share is the share in total cost of project.

* This article is prepared by Pronita P Saikia and R K Sinha in the Corporate Studies Division of the Department of Statistics and Information Management. The views expressed in the article are those of the authors and do not represent the views of the Reserve Bank of India. The previous study titled ‘Private Corporate Investment in 2018-19: Slow Recovery Underway’ was published in the March 2019 issue of the Reserve Bank of India Bulletin.

1 Includes all public sector banks, major private sector and foreign banks, and financial institutions which are actively involved in project financing namely, Industrial Financial Corporation of India (IFCI), Life Insurance Corporation (LIC), Power Finance Corporation (PFC), Rural Electrification Corporation of India (REC) and Export-Import Bank of India (EXIM).

2 ECBs include rupee denominated bonds (RDBs).

3 Pipeline projects are those projects, which are already undertaken for implementation. Capex from a pipeline project are envisaged amounts for a given year, which got sanctioned prior to that given year.

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