Overall slowdown in demand for new equipment, absence of new channels for the deployment of equipment compared to the overall availability, plummeting value of currency, lack of clarity on private coal blocks, highly depressed rental rates - all seems to have had its negative impact on the equipment finance segment. EQUIPMENT INDIA finds out the challenges, growth prospects, and emerging trends of financing.
The infrastructure segment has been witnessing a major slowdown due to various issues with regard to land acquisition and environmental clearances. The ongoing depreciation of rupee has added to the woes. Sumit Mukherjee, National Sales Head, Magma Fincorp says, "The interest rates are at an all time high and have not lessened over a long time. BOT projects are facing delays due to land acquisition and environmental clearances. This has had an impact on financial closures. All these factors have severely hampered the growth of equipment financing over the last couple of years. The economic slowdown in the leading world economies has also added to the woes of this segment. The infra companies are finding it very difficult to raise fresh capital and debt for the projects."