‘Second wave impacts infrastructure finance’

Credit remained sluggish in Q1: Icra

Indian laborers work at a Metro Rail project site in Ahmedabad, India, Monday, Feb. 1, 2021. India's government on Monday announced it will boost healthcare spend amid the coronavirus pandemic and said it was committed to the development of the financial institutions and shoring up of infrastructure to get the pandemic-ravaged nation back as the world's fastest-growing major economy. (AP Photo/Ajit Solanki)

Total infrastructure credit by banks and NBFC-Infrastructure Finance Companies (NBFC-IFCs) remained sluggish in the first quarter of the current fiscal due to the disruptions caused by the second wave of the COVID-19 pandemic, Icra Ratings said in a report.

However, with the government’s focus on infrastructure, the demand for infrastructure credit is likely to improve over the medium term, it said.

“Given the disruption caused by the second wave of the pandemic, total infrastructure credit (banks and NBFC-IFCs) remained sluggish in Q1 FY2022, with infrastructure-focused loan books remaining flat on quarter-on-quarter (q-o-q) basis for both NBFC-IFCs as well as banks,” Icra said in the report.

The total infrastructure credit by banks and NBFC-IFCs is estimated at ₹24.7 lakh crore as on March 31, registering a sluggish growth of 10%, it said, adding given the disruption caused by the second wave of the pandemic, it has remained stable as on June 30.