Editor's Pick | New private investment plans slumped to 20-year low in Q1

New investment plans in India reached a 20-year low in the April to June quarter, with just ₹44,300 crore of fresh outlays announced by corporates. This marks an exceptionally slow start to private capex in this financial year. In the preceding January to March 2024 quarter, outlays worth ₹12.35 lakh crore were announced. The first quarter of 2023-24 had recorded new investment announcements of nearly ₹7.9 lakh crore. Overall, last year had seen investment announcements worth ₹27.1 lakh crore, the second highest in 10 years. Even though a part of the low investment levels in the first quarter (Q1) of 2024-25 could be attributed to a wait-and-watch approach amid the Lok Sabha elections, this tally is far lower than the same quarter over the past two general elections held in 2014 and 2019. New investment plans in Q1 of 2014-15 were at ₹2.9 lakh crore, while they added up to ₹2.1 lakh crore in Q1 of 2019-20. Another factor in the slowdown could be that the last two years have seen high investment announcements that are yet to run their course. “It would need to be seen whether there is any major pick-up in the second quarter considering that the Budget will be announced only towards the end of July. A good monsoon and steady demand during the festival season which starts from the end of August and lasts till December would be the time when investment could increase at a faster pace,” a Bank of Baroda report based on data from the Centre for Monitoring Indian Economy (CMIE) said. Within the ₹44,000-odd crore investments announced over Q1, manufacturing outlays dominated with a 46.4% share followed almost evenly by electricity and services. “Interestingly, over the period between June 2023 and June 2024, the fall in value of investment announcements was ₹7.4 lakh crore. Of this, the major dip was accounted for by the transport services sector at 61%,” the report said, connecting it to the airline industry’s plans to buy new aircraft announced last year. The Hindu’s Editorials Old traditions, new ties: On the importance of the India-Russia partnership ​Winds of change: On the Iran election result The Hindu’s Daily News Quiz Who will head the AAP’s parliamentary party? Harbhajan Singh Raghav Chadha Sanjay Singh Sushil Kumar Gupta To know the answer and to play the full quiz, click here. [logo] Editor's Pick 08 July 2024 [The Hindu logo] [EP Logo] Editor's Pick 08 July 2024 In the Editor's Pick newsletter, The Hindu explains why a story was important enough to be carried on the front page of today's edition of our newspaper. [View in browser]( [More newsletters]( New private investment plans slumped to 20-year low in Q1 New [investment plans]( in India reached a 20-year low in the April to June quarter, with just ₹44,300 crore of fresh outlays announced by corporates. This marks an exceptionally slow start to private capex in this financial year. In the preceding January to March 2024 quarter, outlays worth ₹12.35 lakh crore were announced. The first quarter of 2023-24 had recorded new investment announcements of nearly ₹7.9 lakh crore. Overall, last year had seen [investment]( announcements worth ₹27.1 lakh crore, the second highest in 10 years. Even though a part of the low investment levels in the first quarter (Q1) of 2024-25 could be attributed to a wait-and-watch approach amid the Lok Sabha elections, this tally is far lower than the same quarter over the past two general elections held in 2014 and 2019. New investment plans in Q1 of 2014-15 were at ₹2.9 lakh crore, while they added up to ₹2.1 lakh crore in Q1 of 2019-20. Another factor in the slowdown could be that the last two years have seen high investment announcements that are yet to run their course. “It would need to be seen whether there is any major pick-up in the second quarter considering that the Budget will be announced only towards the end of July. A good monsoon and steady demand during the festival season which starts from the end of August and lasts till December would be the time when investment could increase at a faster pace,” a Bank of Baroda report based on data from the Centre for Monitoring Indian Economy (CMIE) said.  Within the ₹44,000-odd crore investments announced over Q1, manufacturing outlays dominated with a 46.4% share followed almost evenly by electricity and services. “Interestingly, over the period between June 2023 and June 2024, the fall in value of investment announcements was ₹7.4 lakh crore. Of this, the major dip was accounted for by the transport services sector at 61%,” the report said, connecting it to the airline industry’s plans to buy new aircraft announced last year. The Hindu’s Editorials [Arrow][Old traditions, new ties: On the importance of the India-Russia partnership]( [Arrow][​Winds of change: On the Iran election result]( The Hindu’s Daily News Quiz Who will head the AAP’s parliamentary party? - Harbhajan Singh - Raghav Chadha - Sanjay Singh - Sushil Kumar Gupta To know the answer and to play the full quiz, [click here](. 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