While the consumption demand would remain high, there are strong indications that investment has picked up – though perhaps not fully captured by national accounts statistics. Rising investment demand is confirmed by: First, the rise in gross fixed capital formation over the last two years by 29.6% in nominal terms and by about 9.8% in real terms.
This has raised investment levels to Rs 1.42 trillion, equivalent to 20% of GDP and is likely to result in a reversal of the declining trend observed in the preceding years. Private investment accounts for two thirds of the gross fixed capital formation. Second, the rise in imports, which, excluding crude and POL products, grew by 35%.