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Power and IT will continue to be the dominant industries in the near future, as the world increasingly turns to technology areas that will dominate the economic landscape, according to a Bank of Baroda (BoB) report. This projection comes amid a transforming investment climate in the country over the last four years, where distinct sectors attract varied capital based on specific demand conditions.
As per the report, the domestic investment environment shows encouraging trends that persist into the current financial year. A strategic push toward digital infrastructure and data centers creates significant opportunities for potential investors within the IT domain, while the renewable energy sector maintains strong traction. The BoB report stated that post COVID, "For the 4 years, the total amount of new investment announcements were for around Rs 191 lakh crore which is around Rs 48 lakh crore on an average annual basis." "The two dominant sectors which accounted for almost 50% of the total planned investments are electricity and transport services," the report added. Meanwhile, planned investments in the IT space accounted for nearly 6 per cent of the total layout, fueled by a sharp focus on artificial intelligence and data centers. Data from the first 75 days of the year up to June 15 confirms a similar trend, where electricity and IT dominate the landscape and comprise 85 per cent of all proposed investments. This allocation highlighted a deliberate thrust toward power generation to meet growing conventional and renewable energy requirements. As per the report, in transport services, expansion plans span both the aviation and railway sectors. Specifically, two airlines announced intentions to purchase new aircraft, which expanded the total figures. Chemicals and metals follow these sectors with a combined share of roughly 24 per cent, driven by infrastructure activity, machinery, and construction material requirements. Conversely, consumer segments hold smaller shares. The automobile sector holds a 2.4 per cent share, ranking eighth, followed by food-based industries at tenth with 0.7 per cent. Textiles and consumer goods stand at 0.6 per cent and 0.5 per cent, respectively. "Hotels and trading have shares of 0.5% and 0.3% which are rising businesses in the last few years," the report added. "There has been a change in the consumer mindset where there is higher spending on services (which also comes out in the GDP data) relative to goods which includes both tourism as well as ecommerce." Because these service-oriented sectors require lower initial capital than heavy industries like metals or power, they maintain a lower relative share of total investments. On the structural side, the report mentioned that the private sector now leads capital intentions. Prior to the pandemic, the government share in total investment announcements averaged 54.2 per cent. However, between 2022-23 and 2025-26, the private sector claimed a dominant share of 71.3 per cent, indicating a substantial shift in investment ownership. (ANI)
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