India Inc is sitting on a mountain of cash, which is growing every year. By the end of 2002-03, the top private companies had Rs 46,424 crore (Rs 464.24 billion) in cash and cash equivalent -- investments and loans and advances to subsidiaries.

These have been included because the dividends on such investments are akin to the interest on deposits or the periodical returns on mutual fund investments.

This cash pile has grown from Rs 34,629 crore (Rs 346.29 billion) in 2001-02.

The Business Standard Research Bureau looked at the top 24 companies, ranked according to the cash they held. Cash held by these firms, including investments, loans to subsidiaries and bank balances, accounted for 26.5 per cent of their total assets of Rs 1,74,992 crore (Rs 1749.92 billion) in 2002-03, up from 22.2 per cent of their assets of Rs 1,54,669 crore (Rs 1546.69 billion) in the previous year.

Data on the cash flow of companies were sourced from Prowess, the financial database package of the Centre for Monitoring Indian Economy.

The 24 companies studied had bank balances of Rs 7,893 crore (Rs 78.93 billion) at the end of 2002-03. Their investments amounted to Rs 29,281 crore (Rs 292.81 billion). Of this, Rs 16,692 crore (Rs 166.92 billion) was invested in group companies and Rs 5,578 crore (Rs 55.78 billion) in mutual funds. These companies lent Rs 8,375 crore (Rs 83.75 billion) to group companies and Rs 875 crore (Rs 8.75 billion) to other firms.

The rising cash pile suggests that since 1998, when the economy went into a tailspin, Corporate India has not invested in new projects or expansion. Also, some observers conjecture that in a declining interest rate scenario, companies may have opted to put their money in subsidiaries.

Strikingly, cash-rich companies do not earn much revenue from their pile of cash. The other income of the 24 companies increased by a modest Rs 400 crore (Rs 4 billion) to Rs 3,072 crore (Rs 30.72 billion) in 2002-03.

They mopped up Rs 1,677 crore (Rs 16.77 billion) by way of interest income and Rs 414 crore (Rs 4.14 billion) from dividends. Data on other income coming from investments in mutual funds are not available.

At the end of 2002-03, Reliance Industries was sitting on a Rs 13,626 crore (Rs 136.26 billion) cash pile, with investments of Rs 6,723 crore (Rs 67.23 billion) and loans to group companies of Rs 6,756 crore (Rs 67.56 billion).

During the year, the company earned Rs 706 crore (Rs 7.06 billion) from interest and Rs 112 crore (Rs 1.12 billion) from dividends.

Bajaj Auto had a cash pile of Rs 2,987 crore (Rs 29.87 billion), mostly in the form of investments. The company earned an interest income of Rs 126 crore (Rs 1.26 billion) in 2002-03.