You are using an older browser version. Please use a supported version for the best MSN experience.

A boom in the making

LiveMint logoLiveMint 02-06-2014 Livemint

One big reason for India’s precipitous falling growth rate is the huge fall in investment demand. Investment as a percentage of gross domestic product remained flat in 2013-14, official data showed last week.

Two recent pointers make it clearer. One, the new government has granted environmental clearances to projects worth Rs28,000 crore in a short span of time. Two, the appetite of Indian companies for foreign borrowings, especially debt, remains high even as borrowing costs have fallen to their lowest since 2007.

At the moment these are hopeful signs. Real growth, and not just its anticipation, will take place when these investments are actually made. A reason for some uncertainty is that investments take place in states. Some states are keen, others not so much.

That has to change first for growth to restart.

More From LiveMint

image beaconimage beaconimage beacon