Gujarat was the favourite destination with respect to new projects announced during 2007, a study by Mumbai-based ProjectsToday reveals. The study points out that in 2007 (January to December), a total of Rs 3,53,428 crore worth of new projects investment was announced out of which Gujarat cornered Rs 49,670 crore, or 14.1 per cent.
New investment in Gujarat was well distributed across diverse areas like thermal power, petroleum refining, cement, ports and real estate. West Bengal with a share of 11.3 per cent came next in order, closely followed by Andhra Pradesh with 11.1 per cent. Arunachal Pradesh also found mention in the top 10 states with respect to new investment announced in 2007. Thanks largely to a slew of hydropower projects offered for development to private sector enterprise, the state saw Rs 23,645 crore of new investment. By this metric, the hilly state also steered ahead of Madhya Pradesh and Karnataka.
Over 60 per cent of the fresh investment in 2007 came from private sector companies, albeit mainly from Indian companies. Foreign companies had a subdued presence accounting for only Rs 8,291 crore of new projects that stood for a mere 2.4 per cent of new investment in 2007. Private companies were zestful in announcing new investment in the traditional manufacturing sector - cement, metallurgy, textiles, paper etc.
The study also points out that while services and utilities accounted for a respectable 27.5 per cent of the new investment last year, investors appeared to skimp on crucial areas like transport infrastructure. During the year, electricity (mainly generation) was also an attractive destination with 374 projects aggregating Rs 113,507 crore announced, and that too with a large contribution from private sector companies.
As of December 31, 2007, the aggregate projects investment stood at Rs 28.76 trillion, up 14 per cent from Rs 25.19 trillion a year ago. Around 40 per cent of this investment was under physical construction, with the larger majority yet in the announcement or planning stages.