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Private sector capex likely to lift off this fiscal, says RBI study

Loan sanctions at Rs 1.4 trn vs all-time high of Rs 4 trn in FY11

capex, capital, expenditure
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The RBI said the capex of the corporate sector plays a significant role in steering the overall investment climate

Dev Chatterjee Mumbai
Although private-sector capital expenditure (capex) is expected to lift off in the quarters ahead, a recent study by the Reserve Bank of India (RBI) shows project loan demand by Indian companies for capex in 2021-22 (FY22) did not pick up like it did in the preceding years.

Even though the envisioned total project cost of Rs 1.43 trillion nearly doubled in contrast with the record low of Rs 75,558 crore in 2020-21 (FY21), it still remained lower than pre–Covid levels. It is below the Rs 4-trillion annual loans sanctioned for projects since the glory days of corporate investment in 2010-11.