Mumbai:
Indian companies have announced an investment of Rs 32 lakh crore in the period from April to December of the current financial year. This figure is 39 percent more than Rs 23 lakh crore in the same period last year. According to the report, investments worth Rs 13.63 lakh crore are in work-in-progress till March 2024, which shows that the country will see rapid economic growth in the coming years.

Increase in government and private investment

Government investment had reached 4.1 percent of GDP in FY 2023, which is the highest since FY 2012. At the same time, private sector investment was 11.9 percent of GDP, which is the highest level after financial year 2016. The report also estimates that private investment in primary data could reach 12.5 percent of GDP by the end of February 2024.

External Commercial Borrowing Main Funding Source

External commercial borrowing (ECB) remains the major funding source for Indian companies. A total of $190.4 billion of ECBs were outstanding as of September 2024, an increase compared to the previous quarter.

Non-rupee and non-FDI components in the ECB stood at $155 billion, which is provided stability through hedging. The share of private companies in the total ECB is 63 percent ($97.58 billion), of which 74 percent exposure is hedged. At the same time, the share of government companies is 37 percent ($55.5 billion).

By September 2024, two-thirds of the total ECB has been hedged, which was 55 percent two years ago. Some of the unhedged portion is backed by government guarantees, while others enjoy the benefit of natural hedge. According to the report, the share of natural hedge was 1.5 percent of the unhedged ECB, which could offset the earnings in foreign currency.