Thursday, September 11, 2008

Shipping Most Unattractive For Investment

NEW DELHI: Shipping and ports are the most unattractive sectors for investors, claiming less than three per cent of the total investments of the corporates of the country in the first half of 2008, industry body Assocham said.

Of the Rs 6,33,966 crore of investment announcements made by corporates, ports and shipping sector received only Rs 30,690 crore by major companies such as Essar Shipping Ports, Jindal Saw, Shipping Corporation of India and JSW Infrastructure. This in percentage terms works out to be a mere 2.84 per cent.

A major reason for low investment in the sector is that it is highly regulated and marked by procedural constraints, though ports and shipping can absorb a very high volume of investments, according to the chamber.

Another sector that received low investment focus by corporates is construction and manufacturing which could garner only Rs 36,790 crore of investments for a period of January-June 2008. The share in the total investments is only 3.5 per cent and it has happened because of higher input costs and higher cost of borrowings.

Even the IT sector got only Rs 39,654 crores of investment in the period for expansion, upgradation and setting up of IT parks, and software development and delivery centres over the next two to 10 years. IT sector has not been that great centre for investment because it is still reeling under global slowdown and will continue to be so, according to the chamber.

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