Is Kerala Missing Out on India’s Investment Boom?
- Remin Francis I R
- Sep 15
- 2 min read
The Reserve Bank of India’s latest report on private corporate investment gives us some eye-opening numbers. For 2024-25, banks and financial institutions sanctioned 907 projects worth ₹3.68 lakh crore, slightly lower than the ₹3.91 lakh crore across 944 projects in 2023-24. This shows that while companies are still investing, they’re doing so cautiously.
Looking ahead, the picture brightens. Planned capital spending from pipeline projects is set to rise to ₹2.67 lakh crore in 2025-26, up from ₹2.20 lakh crore in 2024-25, a healthy jump of more than 20%. This optimism is supported by stronger corporate balance sheets, improved profitability, easy liquidity conditions, and policy pushes such as PLI schemes and infrastructure expansion.
Where is this money going? Almost 92% of investments are greenfield projects, meaning brand-new factories and infrastructure. Sector-wise, infrastructure dominates with 50.6% of the share, led by the power sector (39.7%), followed by roads and bridges (8.9%), chemicals (7.9%), construction (5.6%), and electronics (4.6%).
Now let’s look at geography. The top five states, Gujarat, Maharashtra, Andhra Pradesh, Rajasthan, and Uttar Pradesh, cornered nearly 60% of all project costs in 2024-25. Gujarat alone accounted for 21.4%, Maharashtra 15.1%, Andhra Pradesh 9.3%, Rajasthan 7.3%, and Uttar Pradesh 7.1%. Clearly, the west and central belts are emerging as the strongest magnets for private investments.
Among southern states, Karnataka attracted 6.2%, driven by IT, electronics, and aerospace, while Tamil Nadu managed just 2.7% in 2024-25, down from 4.7% a year earlier, a reminder that investment flows are dynamic and can shift quickly.
And what about Kerala? Unlike its neighbours, Kerala does not appear among the top destinations for private corporate investment. While the national story is one of gearing up for a manufacturing and infrastructure boom, Kerala seems to be on a different track, relying more on its strengths in services, IT, tourism, seafood exports, and healthcare. This isn’t necessarily a failure, but it does highlight a missed opportunity: if Kerala can align its policies to attract greenfield projects, especially in renewables and food processing, it could capture a bigger slice of India’s investment momentum.
The takeaway? India is cautiously optimistic today, but gearing up for a ₹2.67 lakh crore investment push next year. Kerala’s challenge is to ensure it doesn’t sit out of this boom, but instead plays to its strengths while creating space for larger industrial projects.
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