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Centre lines up infrastructure projects worth Rs 102 lakh cr

Sitharaman said that the private sector share in the overall infrastructure is expected to reach 30 per cent by 2025.

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Nirmala Sitharaman

New Delhi, Dec 31 : In a major push to the slowing economy, the Centre on Tuesday lined up infrastructure projects worth Rs 102 lakh crore across 18 states and union territories (UTs) in various sectors such as railways, urban development, health, water and education.

Unveiling the first report of the Task Force tasked to identify the projects, Finance Minister Nirmala Sitharaman said that the Centre and the states would share 39 per cent each of the total cost with the private sector investing the balance 22 per cent.

The Minister said that infrastructure has been a focus of the government in the last six years with projects worth Rs 51 lakh crore (5 per cent-6 per cent of GDP) taken up.

“We are now committing 102 lakh crore rupees for the next 5 years,” Sitharaman said, adding another Rs 3 lakh crore worth of projects would be added shortly.

It may be noted that out of the total expected capital expenditure of Rs 102 lakh crore, projects worth Rs 42.7 lakh crore (42 per cent) are already under implementation while projects worth Rs 32.7 lakh crore (32 per cent) are in the conceptualisation stage.

The remaining projects are under the development stage.

The ambitious plan has been launched even as the private sector’s response, so far, has been tepid and the once popular PPP model failing to take off.

Most projects in the highways sector have been taken up with the government providing bulk of the funds. But the Centre remains optimistic.

Sitharaman said that the private sector share in the overall infrastructure is expected to reach 30 per cent by 2025.

Among many measures to boost the economy, the government considers building infrastructure as key and has laid emphasis on it. It has stepped up its spending on infrastructure so that it does not become a constraint on the growth of the economy.

The government had earlier constituted a task force to draw up the National Infrastructure Pipeline (NIP) for each of the years from fiscal 2019-20 to 2024-25. The high-level panel is chaired by the DEpartment of Economic Affairs (DEA) Secretary and includes the NITI Aayog CEO, Expenditure Secretary, DEA Additional Secretary (Investments) and Secretaries of the administrative ministries.

The Task Force, in its detailed report, has given recommendations on changes required to several key sectoral policies and other reform initiatives to be initiated by Central and state governments.

The Finance Minister said that this is the first of its kind exercise and would be followed by setting up of a robust monitoring mechanism. She said that NIP will enable a forward outlook on infrastructure projects which will create jobs, improve ease of living, and provide equitable access to infrastructure for all.

It is estimated that India would need to spend $4.5 trillion on infrastructure by 2030 to sustain its growth rate. On the basis of the information compiled as on date, total project capital expenditure in infrastructure sectors in India between the fiscals 2020 to 2025 is projected at over Rs 102 lakh crore.

“During the fiscals 2020 to 2025, sectors such as Energy (24 per cent), Roads (19 per cent), urban (16 per cent), and railways (13 per cent) amount to around 70 per cent of the projected capital expenditure in infrastructure in India,” an official statement said.

Addressing the media, Finance Minister said that an Annual Global Investors’ Meet would be organized with the first edition in the second half of 2020. This will provide a platform to the Centre and the states to meet investors and talk on investment opportunities.

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Bank credit growth may rise 200-300 bps next fiscal: Crisil

Incremental net domestic credit this fiscal up to December 2019 is just a fifth of what it was a year ago.

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Rupee

New Delhi, Feb 25 : Bank credit growth is set to bottom out but may rise 200-300 bps next fiscal while retail lending, supported by securitisation, will remain the key driver in the next fiscal.

The prolonged slowdown in bank lending may be bottoming out this fiscal, with gross credit offtake set to rise 8-9 per cent on-year in fiscal 2021, a good 200-300 basis points (bps) over the likely growth of 6 per cent this fiscal.

A gradual pick-up in economic activity, continuing demand for retail loans, and strong growth in lending by private sector banks should drive the uptick.

Recent policy moves announced in the Union Budget, and by the Reserve Bank of India (RBI) are also expected to provide the spur, Crisil Ratings said on Tuesday.

As for this fiscal, some growth momentum is expected in the fourth quarter, after a subdued three quarters — due to traditional fiscal year ending growth.

The RBI’s move to exempt banks from cash reserve ratio requirement for incremental credit to certain sectors for up to five years will also support lending.

Incremental net domestic credit this fiscal up to December 2019 is just a fifth of what it was a year ago.

Lending to the retail segment and non-banking financial companies showed good growth, while credit to corporates (ex-NBFC) and micro, small, and medium enterprises declined, Crisil said.

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Maruti Suzuki launches all new Vitara Brezza

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Maruti Suzuki Vitara Brezza

New Delhi, Feb 24 : Automobile major Maruti Suzuki India on Monday launched the all new compact SUV Vitara Brezza, which was unveiled at the recently held Auto Expo 2020.

The new vehicle has been priced in the range of Rs 7.34 lakh to Rs 11.40 lakh, the automobile major said on Monday.

According to the company, the new compact SUV offers enhanced sportiness, bolder looks, stronger stance, premium interiors and a host of new features.

The vehicle is equipped with the powerful 1.5 litre K-series BS6 petrol engine.

“The compact SUV will be offered with 5-speed manual and advanced automatic transmission with Smart Hybrid,” the company said in a statement.

In less than 4 years of its launch, Vitara Brezza has sold over 500,000 units.

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Dow Jones plunges 1,000 points over coronavirus fears

Earlier this month, Apple, the world’s most valuable company, rang alarm bells on Coronavirus impact on its sales.

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Mumbai, Feb 24 : The possibility of a coronavirus pandemic sent shock waves across global markets on Monday. Dow Jones Industrial Average lost over 800 points within minutes of its opening.

A sharp sell-off in US markets followed worries of further disruption in economic activity as coronavirus related deaths jumped sharply, particularly outside China.

The S&P 500 traded lower by 84.89 points, or 2.54 per cent, at 3,252.86 while the Nasdaq Composite dropped 287.27 points, or 3 Aper cent, to 9,289.32 at the opening bell.

Italy saw virus cases jumping exponentially from three on Friday morning to more than 150 by Sunday. Italy’s spike now marks the biggest outbreak outside of Asia.

In China, the epicentre of the outbreak, the coronavirus related deaths jumped past 2,600. The deadly virus has infected more than 77,000 people in China and was described by President Xi Jinping as the “largest public health emergency since the founding of the country”.

Earlier this month, Apple, the world’s most valuable company, rang alarm bells on Coronavirus impact on its sales.

Jaguar Land Rover CEO Ralf Speth also reportedly said that the company does not have enough parts from China to maintain its British production post two weeks.

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