Corporate Investment in 1981 - A Forecast

This paper attempts to make a forecast of the growth in private coprorate investment in 1981. Corporate investment is taken to cover gorss capital expenditures of all companies in private and joint sectors. The study also provides a picture of the level and composition of corporate investment in 1980. The methodology used in this paper to forecast corporate investment relies on the data available with the term lending institutions on the phasing of capital expenditures of projects sanctioned by them. The details of the technique followed have been explained by the author in his earlier writings. Capital expenditures in 1980 on all projects sanctioned by the term lending institutions so far would amount to Rs 1400 cores which will mean in nominal terms a rise of 16 per cent over the level of Rs 1210 crores achieved in 1979. At 1970-71 prices, this will imply a rise of 7.5 per cent. Looking at 1981 it is seen that based on all the projects sanctioned until the end of 1980 the capital expenditures are likely to be around Rs 1170 crores. Taking into account the expenditures that will be made out of the projects to be sanctioned in 1981 itself, it can be concluded that corporate investment in 1981 will rise by 15 per cent. The rise in real terms will be nine per cent.