CII calls for higher public capex, investment push to sustain growth

New Delhi: Sustained flows of public, private and foreign capital will be critical to preserving India's position as one of the fastest-growing major economies, said the Confederation of Indian Industry (CII).

The industry body recommended a 12% increase in central capital expenditure and a 10% rise in capex support to states in FY27, with focus on high-multiplier sectors such as transport, energy, logistics and green transition.

"The forthcoming union budget 2026-27 has to serve the dual role of stabiliser and growth enabler, and promoting investments will be one of the most critical components in this regard," said Chandrajit Banerjee, director general, CII.

To improve efficiency and certainty, it proposed a Capital Expenditure Efficiency Framework, a ₹150 lakh crore National Infrastructure Pipeline 2.0 for 2026-32 and a cycle-based public debt framework to enhance fiscal flexibility and stability. Banerjee noted that after recent demand-side tax relief (income tax and GST cuts), private investment should be the next key growth driver.

To boost private investment, the industry body suggested incremental tax credits, compliance relief and accelerated depreciation to encourage reinvestment, capacity expansion and technology upgrades, particularly in manufacturing, MSMEs and high-growth sectors.

It also proposed setting up an NRI Investment Promotion Fund, with up to 49% government stake to channel NRI, FPI and institutional funds into areas like infrastructure and AI, alongside strengthening the National Investment and Infrastructure Fund (NIIF) through a Sovereign Investment Strategy Council. Its recommendations include easing ECB norms and introducing single-window and time-bound FDI clearances to boost investment.

"An investment-driven growth strategy, anchored in fiscal credibility and institutional reforms, will define India's next development phase," said Banerjee.

The industry body also suggested building an India Global Economic Forum as a government-led platform that brings together MNCs, sovereign wealth funds, pension funds, private equity and other institutional investors for "structured dialogue with senior government leadership on emerging investment opportunities across sectors".