According to the Centre for Monitoring Indian Economy (CMIE), investment proposals to set up new capacities has declined substantially in the quarter ended December 2015.
As per the data, proposals in real estate, steel and cement sectors are seeing slowdown or cancellation. In real estate, new intentions have been much lower while in cement and steel, projects were scrapped, reflecting bearish mood of promoters.
Investments worth Rs 1.05 lakh crore across 381 new projects were announced in the December 2015 quarter, which is 74 per cent lower than the third quarter of FY15. In the December 2014 quarter, the sentiment was upbeat on hopes from the Bharatiya Janata Party (BJP)-led government at the Centre and companies had planned investments of Rs 4 lakh crore, which at that time was the highest in the past 17 quarters.
However, what could be a positive sign, stalled projects dropped sharply to Rs 16,500 crore, lower by 86 per cent compared to the December 2014 quarter, and 60 projects were shelved. The average quarterly stalling of projects between 2011-12 and 2014-15 was to the tune of Rs 1.3 lakh crore, according to CMIE.