Investment pouring in: SBI report

India’s investment ecosystem and external commercial borrowings (ECBs) have witnessed significant developments over the past few years. A recent report by the State Bank of India (SBI) has highlighted trends in investment announcements, the private sector’s contribution, and role of ECBs in corporate financing, an official press release said.

Investment activity in India continues to grow at a rapid pace, with significant contributions from the private sector.

In the first nine months of the current fiscal, total investment announcements stood at Rs 32.01 lakh crore, a 39 per cent increase from Rs 23 lakh crore in the same period in 2023-24, reflecting a positive investment outlook. The private sector accounted for nearly 56 per cent in 2023-24) and nearly 70 per cent (9MFY25) of these announcements, signaling strong corporate confidence.

As of March 2024, the gross block of Indian corporations reached Rs 106.5 lakh crore, compared to Rs 73.94 lakh crore in March 2020. Over the last five years, an average of more than Rs 8 lakh crore has been added annually to the corporate gross block. Additionally, capital work in progress stood at Rs 13.63 lakh crore in March 2024, indicating strong ongoing project development.

Household bet financial savings (HNFS) in India improved to 5.3 per cent of GDP in 2023-24 from 5 per cent in 2022-23. Additionally, savings in physical assets increased from 12.9 per cent of GDP in 2022-23 to 13.5 per cent in 2023-24.

Investment as a share of GDP has improved in recent years, led by both government and private sector contributions.

In 2022-23, government investment reached 4.1 per cent of GDP, the highest since 2011-12. Private corporate investment rose to 11.9 per cent of GDP in 2022-23, its highest level since 2015-16. The share of private investment is projected to further increase to around 12.5 per cent in 2023-24, reflecting improved business sentiment.