India’s private capital expenditure surged by 67% to reach Rs 7.7 lakh crore in September 2025, marking a robust revival in the country’s investment cycle, as reported by the Confederation of Indian Industry (CII). This growth is a significant increase from the Rs 4.6 lakh crore recorded in September 2024.
According to CII’s analysis of around 1,200 companies from the CMIE Prowess database, the manufacturing sector contributed Rs 3.8 lakh crore, accounting for nearly half of the total private investment. Sectors like metals, automobiles, and chemicals led this surge. The services sector also played a vital role, contributing Rs 3.1 lakh crore, with trading, communications, and IT/ITeS industries driving the growth.
Additional economic indicators support this positive trend in investment activity. Manufacturing firms saw a rise in capacity utilization to 75.6% in the third quarter of FY26 from 74.3% in the previous quarter. New order books expanded by 10.3% year-on-year, and bank credit growth accelerated significantly, averaging close to 14% in the second half of FY26 compared to around 10% in the first half.
Chandrajit Banerjee highlighted that the substantial increase in private capital expenditure indicates a clear turnaround in India’s investment cycle. He emphasized that private enterprises are now investing capital across various sectors on a scale not witnessed in over a decade.
In response to the ongoing West Asia crisis and global economic uncertainties, CII introduced a five-point industry action plan to maintain economic stability and sustain growth momentum. The proposals include gradually rolling back the central excise duty cut on petrol and diesel over six to nine months as crude oil prices stabilize. Additionally, an industry-led energy conservation initiative is suggested to reduce fuel and power consumption by 3 to 5% over the next two quarters.
CII also recommended a voluntary 45-day MSME payment guarantee supported by the TReDS platform and supply-chain finance mechanisms to alleviate working capital pressures for small businesses amid the volatile global environment. Chandrajit Banerjee credited the government for this positive shift and urged the industry to leverage the favorable policy environment to boost investments, job creation, exports, and value addition.
