Infra lending gains traction, but may see gradual growth going forward

Lenders are waiting for clear demand patterns to emerge and policy stability, say analysts

Keeping pace with the upturn in economic activity, bank lending to the infrastructure sector rose 11.1 per cent year-on-year (YoY) in July. 

While the trend looks durable, lenders and investors expect the growth to be gradual hereon depending on clear demand patterns to emerge and certainty in policies.

Rajkiran Rai G, managing director, National Bank for Financing Infrastructure and Development (NaBFID), the new government-owned financial institution that is expected to start business later this year, said banks have been talking about sanctioned credit pipeline, and disbursements have begun and are expected to be consistent. Generally, funds for infrastructure are disbursed