Investors’ faith that India would keep building was on display in 2019, even as forecasts project growth to cool even further.

Buoyed by a surge in infrastructure-focused deals, private equity investments gained 2.8% to $37 billion, according to Venture Intelligence, an Indian research and analysis firm. The previous high was 2018’s $36 billion. The number of transactions slowed to 861 from 937 a year earlier. 

Growth is expected to slow to 5% for the year ending in March, the country said last week, from the previous year’s 6.8%. While consumption and lending have slowed amid rising unemployment and a banking crisis, PE investors boosted spending on infrastructure deals — infrastructure accounted for 40% of the money spent by private equity in 2019, up from 20% the previous year. 

“The fact that the PE investment tally of 2019 outdid the previous high of 2018 — despite uncertainties on the economic, political and global trade fronts — is very encouraging,” Arun Natarajan, founder of Venture Intelligence, said in a statement. “The sheer diversity of investors that are now actively investing in India — by geography (including North America, Asia and Middle East) as well as sector preferences — provides scope for optimism that the momentum will be maintained into the New Year.”

Brookfield Asset Management was behind the two biggest investments last year, with $3.66 billion in Reliance Industries’ telecommunications tower business, and $1.875 billion in Reliance’s natural-gas pipeline arm.

The third-biggest investment in 2019 was made by three private-equity firms that combined resources to take a stake in GMR Airports, the operator of the Delhi and Hyderabad airports. The fourth biggest transaction was for $1.075 made by three firms in GVK Airports.

The share of the investment pie taken by banking, financial services and insurance, energy and construction, and healthcare, dropped.

India should continue to attract investment in 2020 if the projections of Goldman Sachs, Blackstone and other financial giants are correct. Despite rising unemployment and slowing consumer spending, signs indicate “a tentative sense of stabilization in the Indian economy,” Jan Hatzius, the chief economist at Goldman Sachs, told CNBC last month. The combination of a better world economy and domestic-policy changes should boost growth, Hatzius said.

  • The Indian government will probably continue business-friendly reforms in 2020 and the economy will grow 6% this year, Blackstone’s Vice Chairman Byron Wien and Chief Investment Strategist Joe Zidlep, said in a Jan. 6 report.
  • India-based technology startups attracted a record $14.5 billion from investors in 2019, according to research firmTracxn.
  • India is likely to be the next front in the rivalry between Facebook and Tiktok, Entrackr reported, citing two unidentified people familiar with the matter. The U.S. social media giant plans to launch its short-video sharing app Lasso in the country, most likely by May, Entrackr reported.