Chief Economic Adviser V Anantha Nageswaran has indicated that private sector capital formation is holding up well in FY26, signaling robust investment momentum despite global uncertainties. Early data suggests a rebound in private capex, with fresh investments surging in key sectors like renewable energy and infrastructure, supporting India’s projected GDP growth of 6.8–7% for the year.
India’s Chief Economic Adviser, V Anantha Nageswaran, has provided encouraging updates on the state of private sector capital formation in the current financial year (FY26). Speaking at a recent event, Nageswaran highlighted that private capital expenditure (capex) has rebounded strongly after a moderate dip in FY24, with fresh investments picking up pace in the first half of FY26.
The CEA noted that the investment momentum is being driven by both domestic demand recovery and supportive policy measures, including regulatory reforms and improved ease of doing business. He emphasized that the government’s focus on fiscal stability and low borrowing costs is helping to create an environment conducive to private investment.
Key Highlights
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Private sector capital expenditure has rebounded strongly in FY25 and is holding up well in the early months of FY26, countering earlier concerns of a slowdown.
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Fresh private investment in Q1 FY26 surged by 43.11%, with a significant portion directed toward renewable energy projects, especially solar and wind power.
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The government’s policy reforms, including deregulation and fiscal prudence, are supporting private sector investment and improving business sentiment.
Total resource mobilization in the economy—including non-bank lenders, commercial paper, and equity markets—has grown by 28.5% annually over the past six years, indicating robust funding availability for capex.
The CEA reiterated that sustained growth will depend on private sector stepping up capital formation, hiring, and innovation, alongside government-led infrastructure development.
Sources: Economic Times, Moneycontrol, News18, Lokmat Times, Indiastat