India Inc’s funding plans took a extreme beating when the Covid pandemic raged throughout the nation in 2020-21 with the variety of new tasks sanctioned dwindling and tasks already within the pipeline additionally slowing down.
Data on phasing plans for 2021-22 referring to tasks within the pipeline level to persisting near-term dangers to the funding outlook, the Reserve Bank of India stated in a report. In all, banks and monetary establishments sanctioned solely 220 challenge proposals of the personal corporations throughout 2020-21, a file low within the latest years. The complete price of tasks sanctioned too declined sharply to Rs 75,558 crore in 2020-21 from Rs 1,75,830 crore in 2019-20, the RBI stated.
Altogether, funding plans of 576 tasks had been made throughout 2020-21 aggregating to Rs 116,603 crore as towards 827 tasks with funding intentions totalling Rs 271,374 crore in 2019-20. As many as 344 corporations raised an quantity of Rs 40,382 crore by means of ECBs and FCCBs and didn’t avail of any financing from the banks and FIs. Further, 12 corporations didn’t avail of any financial institution finance or ECBs and FCCBs however raised Rs 663 crore for his or her capex wants by means of home fairness points.
The contemporary sanction of tasks within the first half of 2020-21 dwindled to 68 tasks, a file low in comparison with 137 tasks sanctioned through the first half of 2019-20, clearly indicating the position of Covid, the RBI stated. The majority of banks and FIs reported ‘Nil’ tasks through the first half of 2020-21, which factors to very subdued funding local weather of personal company sector owing to pandemic induced uncertainties.
“The second half of 2020-21 showed some signs of recovery in terms of number of projects, which got financial assistance from the banks and FIs, though the investment climate remained subdued in terms of total cost of projects sanctioned by these entities,” it stated. According to the RBI report, the size-wise distribution of tasks confirmed a noticeable lower within the variety of mega tasks (Rs 5,000 crore & above) from 5 in 2019-20 to at least one in 2020-21 together with a lower in its mixed share within the complete challenge price. Similarly, the variety of massive tasks of measurement Rs 1000 crore-5000 crore declined from 36 (in 2019-20) to 24 in 2020-21.
The relative share of such tasks though elevated to 53.5 per cent in 2020-21 from 37.4 per cent in 2019-20, which signifies larger relative presence within the small cohort of tasks sanctioned in 2020-21, it stated.
Data for the final 5 years (2016-17 to 2020- 21) revealed that greater than half (52.3 per cent) of the tasks had been taken up in 5 states — Gujarat, Maharashtra, Karnataka, Andhra Pradesh, and Tamil Nadu. In 2020-21, Rajasthan and Gujarat every accounted for the very best share (17.1 per cent) within the complete price of tasks sanctioned by banks/FIs adopted by Andhra Pradesh (15 per cent), Uttar Pradesh (13.7 per cent) and Maharashtra (8.5 per cent), it stated.
