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Abhrajit Gangopadhyay

According to top State Government officials, the dip in investment flows was in line with "external uncertainties and lack of upturn in the local economy".

BANGALORE, April 7

KARNATAKA Udyog Mitra, the single-window investment proposals clearing agency, has sanctioned small and medium projects below Rs 50 crore, totalling Rs 1806.67 crore for financial year 2002-03, down from Rs 2042.92 crore a year ago, top government sources said.

While the Udyog Mitra cleared 95 projects in 2002-03, it had sanctioned 103 projects in the previous year. The proposed investments were uniformly spread across sectors ranging from information technology to floriculture.

According to top State Government officials, the dip in investment flows was in line with "external uncertainties and lack of upturn in the local economy".

However, the officials said, "the momentum of investment flows will be sustained in the current fiscal as there are enough signs of eth economy picking up".

The Karnataka Government through its high level committee cleared projects worth Rs 10,000 crore in 2001-02. Almost 60 per cent of the total cleared projects have started taking shape in the State, sources added.

Investment proposals in the automobiles, electronics, pharmaceuticals and food processing currently dominate the list, the official said.

Infrastructure for information technology seems to have taken a backseat as the sector is currently in doldrums trailing a cramped US market.

Since the equities market remains depressed, there is not much public money flowing into the market, the officials said. Lenders are also shying away from financing heavy projects following fears of adding on bad-loans to their balance sheets. Though the momentum in investment is sustained in the small and medium industries, there is hardly any upward tick on large investments in the State.

It can be recalled that only 3.13 per cent of projects sanctioned in the Global Investors Meet in 2000 has been commissioned.

The meet sanctioned projects totalling Rs 27,050.76 crore. The only consolation could be that 25.4 per cent of the projects worth Rs 6,872.03 crore are currently underway.

Though close to 70-information technology projects were cleared during the investors' meet, only seven projects have been completed and another seven such projects are in various stages of implementation.

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