CMIE data paints grim picture of stalled projects

 In a grim outlook for the economy, data from private research body Centre for Monitoring Indian Economy (CMIE) showed investment in the country slowed in April-June period while project completion fell sharply and value of stalled project remained as high as Rs 11.2 lakh crore.

The report said that most of the stalled projects are in the electricity and steel sector. While electricity sector has 31% stalled projects that of steel sector has about 25% in the April-June quarter.

It said above 42% projects are stalled due to the lack of regulatory clearance and input availability, about 10% projects are launguishing due to land acquisition problem, 93% of which is in the private sector. A similar percentage of projects are stalled in private sector due to lack of funds, the report said, reflecting the stressed balance-sheet of the private companies.

The value of projects completed fell to Rs 397 billion in the quarter ended June 2016. This is the lowest value of projects completed in any quarter in nearly 10 years, the report said.

“In the past two years, on an average, projects worth Rs 1,176 billion got completed during a quarter. There is a large variation in the value of completions from quarter to quarter. The lowest completion was of Rs 670 billion in the September 2014 quarter and the highest was Rs 2,132 billion in the March 2016 quarter. Compared to this record of the recent past, the Rs 397 billion of completion in the June 2016 quarter is a new low,” the report,  the findings of which is given due weightage in formation of government policies.