Five states get half of PSUs investment: ASSOCHAM

Maharashtra, Andhra Pradesh, Tamil Nadu, Odisha and Uttar Pradesh were the major investment destinations for the Central Public SectorEnterprises (CPSEs) claiming 50 per cent of their total investment of Rs 5.5 lakh crore between 2008-09 ad 2012-13, an ASSOCHAM study has noted.

Maharashtra alone claimed 20 percent in the total gross block, followed by Andhra Pradesh (8.4 percent), Tamil Nadu (8.1 percent), Odisha (6.7 percent) and Uttar Pradesh (6.2 percent).

The investment would have been much more with improved employment generation had there not been delays in execution and implementation of the new projects, the ASSOCHAM study said.

There were altogether 582 projects under implementation in the central sector as on June, 2013.  Out of these, 311 projects reported a time over run ranging from one month to 240 months which could have had a negative impact on employment.

D S Rawat

“Investment is a function of the state of economy, historical base of the concerned CPSE, industrial environment and the push factor of the states besides priorities of the Central Government. Despite talks of autonomy, the public sector investment decisions are influenced by several factors other than pure commercial considerations,” ASSOCHAM Secretary General D S Rawat said.

Besides the top five states receiving the maximum of CPSE investment, other major beneficiaries included West Bengal (5.3 percent), Chhattisgarh (4.8 percent), Assam (3.9 percent), Madhya Pradesh (3.8 percent), and Himachal Pradesh (3.4 percent), adds the ASSOCHAM paper.

Interestingly, those which are at the bottom of the investment destinations include some of the developed states like Gujarat, Karnakata and Haryana. The bottom states in terms of CPSE investments are:  Bihar (3.2 percent), Gujarat (2.8 percent), Karnataka (2.5 percent), Jharkhand (1.9 percent), Kerala (1.5 percent), Rajasthan (1.1 percent), Jammu & Kashmir (1.1 percent), Arunachal Pradesh (0.9 percent), Uttaranchal (0.8 percent), Punjab (0.7 percent) and Haryana (0.6 percent), highlights its paper.

“The CPSEs investment growth rate was recorded at 9.05 percent in 2012-13 on year on year basis as compared to 13.42 percent in 2011-12, 9.48 percent in 2010-11 and 15.52 percent in 2009-10”, adds the paper.

To be fair to them, the CPSEs managed to rake in a smart growth in net profit despite difficult years in the global and domestic economy. Overall net profit of all 229 CPSEs during 2012-13 stood at Rs. 1.15 lakh crore compared to Rs. 0.98 lakh crore during 2011-12 showing an increase of 17.36 percent.