The government’s demonetisation move is seen dampening short-term economic growth in the country, CLP India, the country’s largest foreign investor in power sector, said today.
However, in the long run, the company expects these reforms will benefit the economy, it added.
“The Government’s demonetisation initiative in November 2016 to curb black money and the implementation of a goods and service tax reform are expected to further dampen short-term economic growth. But in the long run, we expect these reforms to put India on a stronger footing towards improving transparency and better compliance, benefitting the business sector,” CLP India said in a statement.
The company is a wholly owned subsidiary of CLP Holdings Limited, which is listed on the Hong Stock Exchange and is one of the largest investor-owned power businesses in Asia. CLP India has made a total investment commitment of over Rs 15,000 Crore in the country.
Going ahead, the company said it will continue its investment in renewable energy projects including possibility of decentralised generation and power transmission sector.
It said considering the government’s “clear” plans to reduce dependency on coal and fossil fuel, the company expects its long-term growth from renewable energy sector.
“We remain confident of the future prospects of India’s power industry and will continue to contribute to the country’s transition to a low carbon future through investing in renewable energy projects, including the possibility of decentralised generation, and potentially in transmission infrastructure to bring that energy to customers,” CLP India said.
Talking about its operations in 2016, the company said during the year, it continued to develop its renewable energy portfolio and construction of its maiden solar project in southern India is progressing.
“The electricity produced by our wind farms in 2016 was 16% higher than in 2015 due to additional capacity added in the second half of 2015.
The commissioning of these new projects has consolidated our position as one of the biggest renewable energy developers in India,” it said.
CLP said its group operating earnings in 2016 increased 7.1 per cent to Hong Kong $12,334 million from a year earlier. Total earnings were down 18.8 per cent to Hong Kong $12,711 million after taking into account one-off items that affected comparability including a significant contribution from the sale of the Iona Gas Plant in Australia in 2015.