Dynamics of Investment Across Regions and States in India : A Microscopic View

During the last more than half a decade the Indian economy has been found in a rapidly moving growth trajectory with GDP growth mounting to more than 8% recently. Economic growth in general and that in the developing countries in particular, is supposedly a function of growing investment. Moreover, investment across various regions and states is also a pre-condition for balanced regional growth and quality of investment of the country concerned. In the light of the above, the present paper has made an attempt to examine the dynamics of investment across India. Considering the main three parameters of investment viz. investment intentions, implementations and implementation ratios, the present paper has made a region-wise and a state-wise analysis over a period of seven years i.e., from March 2004 to March 2010. It has been found that, contrary to the general belief that development is investment led, in India and in her various regions/states it has not been seen so. It has also emerged from the study that high investment attracting regions/states do not necessarily show high implementation ratios whereas low investment areas depict relatively better implementation of the acquired investment. The study concludes with suggesting a balanced growth of investment across regions, better infrastructure creation to sustain investment and caution for state governments to narrow down the gap between investment receipt and investment implementation