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Finance ministry says private investment is on a roll
New Delhi, Mar 26: The finance ministry expects private investment, including Greenfield projects, to pick up shortly citing the tremendous response from the public to the slew of recent Initial Public Offers (IPOs) as a pointer.
New Delhi, Mar 26: The finance ministry expects private investment, including Greenfield projects, to pick up shortly citing the tremendous response from the public to the slew of recent Initial Public Offers (IPOs) as a pointer.
“Besides, the pick up in non-food credit in recent months is also an indicative of the fact that investment activity is on the upswing,'' says Dr Ashok Lahiri, chief economic adviser to the finance ministry.
Thus, in the ministry's expectation, the long time stagnation in private investment, which some experts went so far as to characterise as an 'investment famine', would soon be a thing of the past.
Dr Lahiri says not only excess capacities created in the past are now being utilised but also entrepreneurs are setting up new projects.
He says that the high growth rate of around eight per cent in the current fiscal, which was likely to be sustained in the coming years, would generate its own demand, thus providing a stimulus to private investment.
When asked to comment on the widespread apprehension in the markets that with inflation crawling up interest rates could harden, Dr Lahiri said then this was the opportune time for businessmen to borrow funds and undertake investment.
Thus, in the ministry's expectation, the long time stagnation in private investment, which some experts went so far as to characterise as an 'investment famine', would soon be a thing of the past.
Dr Lahiri says not only excess capacities created in the past are now being utilised but also entrepreneurs are setting up new projects.
He says that the high growth rate of around eight per cent in the current fiscal, which was likely to be sustained in the coming years, would generate its own demand, thus providing a stimulus to private investment.
When asked to comment on the widespread apprehension in the markets that with inflation crawling up interest rates could harden, Dr Lahiri said then this was the opportune time for businessmen to borrow funds and undertake investment.
Dr Lahiri said the government has been able to raise Rs 15,000 crore through disinvestment, the bulk of which has been through the six IPOs, which hit the capital market recently. IPO's of other private companies have also been a success.
Bureau Report