Karnataka stood fifth in attracting private sector investments (including both domestic and foreign private sectors) across the country as of June, 2012. According to a study conducted by the Associated Chambers of Commerce and Industry of India (Assocham), the state had a share of over 7 per cent after Gujarat (12.5 per cent), Odisha (10.7 per cent), Maharashtra (8.9 per cent) and Andhra Pradesh (8.4 per cent).
Of the outstanding investments in Karnataka worth over Rs 10.4 lakh crore, private sector accounts for over Rs 6 lakh crore, thereby registering a share of over 57 per cent in the overall investments across the state, a sector specific analysis titled ‘Composition of Outstanding Investments Across States’, carried out by Assocham.
Besides, with a share of over Rs 82.9 lakh crore, the private sector accounts for over 59 per cent of the total outstanding investments across India worth over Rs 140 lakh crore as of June 2012. Private sector investments account for a whopping 86.6 per cent in the total outstanding investments worth over Rs 4.5 lakh crore in Haryana which has a share of about 4.8 per cent in the total private sector investments made across India. “Flow of private investments is decided by the attractiveness of investment opportunities as they are mostly driven by profitability considerations,” said Ravindra Sannareddy, chairperson of Assocham Southern Region Council, while releasing the findings of the chamber’s analysis. With private sector investments worth over Rs 8.8 lakh crore, Odisha ranks second with a share of 10.7 per cent in the total private sector investments across India. Besides, the private sector accounts for almost 75 per cent share in the total outstanding investments worth over Rs 11.8 lakh crore across the state.
Andhra Pradesh (8.4 per cent) and Karnataka (7.2 per cent) are other states with maximum share in outstanding private sector investments across India. Interestingly, the share of private investments in the live investments across Maharashtra, Andhra Pradesh and Karnataka is less than the all-India average of over 59 per cent, points out the Assocham analysis. “Bureaucratic efficiency, infrastructure facilities, and ease of land acquisition influence the flow of private investments. Tax concessions, product market conditions and exit policies are effective tools of private investment attraction,” Sannareddy said. Kerala, Himachal Pradesh, Jammu and Kashmir, Uttarakhand and Assam have the least share in India’s total private sector investments, which is even less than 1 per cent, the study added.