SOME "FEEL GOOD" POINTERS FOR THE WEEKEND

By Ruma Dubey

As the weekend approaches and we look forward to a day or two of relaxation, the weekend goes better when it ends on a good note. And to keep that mood going, to assure oneself that things are indeed positive, here is a list of some feel good facts.

This, for many, us included, may sound like one more of Modi’s chest thumping speeches but here the difference is that there is a specific dateline and project details are given. Yes, missing the deadline is nothing new but at least, we have a list of things to look forward to. These are obviously macro factors and if indeed achieved, would make a huge difference.  This data has been compiled based on CMIE reports.

• The best news which should ideally kick start growth and perk up the moods -  industrial and infrastructural projects worth Rs.9.4 trillion are scheduled to be completed during 2015-16.
• 2,483 projects are expected to be commissioned during the year as against 1,252 that were completed in 2014-15.
• Yes, there is large cost overrun but ultimately, the project will be completed –that’s the promise at least. 180 projects that are scheduled to be completed in 2015-16 cost over Rs.10 billion which originally was scheduled to cost Rs.6.78 trillion. As against this, in FY15, only 68 such big projects (with cost greater than Rs.10 billion) with an aggregate cost of Rs.2.91 trillion were completed.
• The electricity sector is expected to be the largest contributor to project completions in 2015-16. Projects worth Rs.2.98 trillion are expected to be completed in the sector during the year.
• 286 electricity generation and distribution projects are scheduled to be commissioned v/s  141 in FY15, bringing on stream a record generation capacity of 34.2 GW v/s just 19.6 GW capacity in FY15.
• Good news on the transport segment too - projects worth Rs.1.79 trillion are expected to be completed this fiscal  with the biggest chunk coming from road transport  at Rs.1 trillion. Railways is at Rs.390 billion while air transport is at Rs.152 billion.
• In the metal industry, the target is projects worth Rs.934.17 billion getting completed while construction and realty is to witness to the tune of Rs.580 billion.
• The Steel industry is expected to add 17.3 million tonnes of steel making capacity and this will mean investments of Rs.899 billion.
• In chemical industry – three big projects are scheduled for completion in FY15. This would be IOCL’s Rs.345 billion worth refinery at Paradip in October 2015. Next is ONGC’s Dahej petrochemical project worth Rs.271.2 billion. Reliance Industries will also make news this fiscal – its Jamnagar petrochemical expansion project worth Rs.160 billion is also to be completed.

• In terms of investment proposals, those to set up new capacities rose by 23% (YoY) at end of Q2FY16 and  458 new projects with investments worth Rs.3.5 trillion were announced during the quarter.
• Growth, as usual was driven by the private sector – its investment in new proposals announced rose 51% and that by the Govt actually showed a decline by 3%.
• Manufacturing sector attracted the largest amount of investments - 159 projects with investments worth Rs.1.65 trillion, up 200%. Private sector investment was highest since 2010 led by  Vedanta, Foxconn, Adani, General Motors, Asian Paints and Gujarat Foils.
• In terms of state-wise break-up – Tamil Nadu led  with maximum amount of new investment proposals during Q2FY16 with MoUs worth Rs.1 trillion being signed. OPG Power Generation Pvt Ltd’s coal based thermal power project at Nagapattinam and Malaysia based IEV Group’s plan to set up LNG terminal gave the state this lead.
• Second place was held by Maharashtra and third was Uttar Pradesh.

Well, take all this good news with a pinch of salt. In terms of project completion, we do not know for sure that these projects will indeed get commissioned. The past track records are not too enthusing  but at least we have a ballpark schedule instead of mere talk in the air.

And ditto for new investment proposals – these are promised, only MoUs. There could always be a slip between the cup and the lip. The only solace – we are worthy of such large investments! If only other things on building infrastructure takes off….