BANGALORE: The Associated Chamber of Commerce and Industry of India (ASSOCHAM) has made vivid observations about Karnataka’s live investments in its strategy paper titled ‘Achieving Higher Growth in Karnataka’. The paper, released in the city on Saturday, focused on achieving higher growth in Karnataka.
“Though the State has successfully attracted investment proposals worth about Rs 10 lakh crore in about 1,624 live projects, 43 percent of these remain non-starters while some initiative has been taken in 57 per cent of the projects,” the paper pointed out.
Further, the study claimed, out of 57 percent projects under implementation, most of them are at MoU stages and a lot more is to be done in facilitating the same.
“With a share of over Rs 3.84 lakh crore, manufacturing sector accounted for lion’s share of 39 percent of total live investments followed by services (24.6 percent), real estate (15.2) and electricity (14.1),” said the study.
“Attracting about Rs 9.75 lakh crore, out of a total investments worth over Rs 137.7 lakh crore, made across the country, Karnataka accounted for 7.1 per cent of total investments made by both government and private sectors in India as on December 2011,” explained the ASSOCHAM officials.
According to the report, the private sector contributed about 55 per cent of the total investments attracted by the State and government sources accounted for the remaining 45 per cent.
Speaking about the power sector, the ASSOCHAM said that it had sought improved power supply to industries, suggesting that the State government focus on low-cost energy generation and developing non-conventional sources of energy like solar, biogas, wind and nuclear sources to increase the power supply.
“Though energy sector has attracted huge investments in the past, the major hurdle is completion and commissioning of these projects to realise their actual benefits. The State government must fix a definite timeline to achieve financial closure and operationalisation of existing projects. ASSOCHAM has suggested the state leadership to encourage PPP to leverage the hydropower potential of the state to meet the energy needs. A comprehensive blueprint must be brought out for power sector development,” said J Crasta, Co-chairman, SRDC.
Further advising that the government maintain a futuristic view while addressing issues like economic slowdown, poor demand in realty sector, a prevailing sense of uncertainty vis-a-vis continuation of fiscal incentives in Direct Tax Code (DTC) regime and Goods and Services Tax (GST) regulations.
Ravindra Sannareddy, Chairman, Southern Regional Development Council, D S Rawat, Secretary General, ASSOCHAM, J Crasta, Co-Chairman, Southern Regional Development Council and Asad Wasi, Director, Southern Regional Office released the paper.