Factory investment rate tumbled to 17-year low after demonetisation

Employment and wages rise in factories, but key sectors lose jobs

In the year when the goods and services tax (GST) was implemented, investment in the country’s factories fell to 22.4 per cent of the gross value added (GVA) by them, down from 27 per cent in 2016-17. Only once in the past 30 years has gross fixed capital formation fallen below this level, shows latest data from the Annual Survey of Industries (ASI).

In nominal terms, factory investments, represented by gross fixed capital formation, contracted 10.3 per cent over 2016-17, showing their worst performance since 2002-03. 

However, the share of wages paid to workers inched up to 13.1 per cent