Private investments likely to gain pace in second half: CII President

economictimes.indiatimes.com:

Private investments will likely gather momentum and get more broad-based in the second half of the year, providing support for the economy to grow 6.8% in FY24, Confederation of Indian Industry president R Dinesh told ET.

«We actually found a significant majority of our members, which we surveyed, saying that their investments in H2 are going to be higher than H1. Investments are also more broad-based this time,» Dinesh said, adding that even capacity utilisation is between 75% and 95% for most sectors.

He pointed out that investments were also picking up in service sectors such as real estate and hotels, as well as infrastructure-related industries.

Gross fixed capital formation, a proxy for investment, rose in double digits in the second quarter, taking the nominal investment rate to its highest level since 2015. «You have all of the tailwinds, which have supported the economy this year,» Dinesh added.

Commenting on the tepid rural demand, Dinesh said that there might be some pick up in rural demand towards the end of the year, but certain gaps will remain.

Asked about growing populism, seen in assembly elections, as the country gears up for general elections in 2024, the CII president noted that welfare measures were necessary to benefit the population as long as the government could maintain fiscal discipline. «We have been saying fiscal discipline is very important, which I think this government has been more than circumspect in making it happen.

Subject to that, whatever needs to be done to uplift the people who have not had the opportunity to grow, as an industry we have to support,» Dinesh said. Laying out the roadmap for sustained economic growth, Dinesh said the government in power will need to ensure four