New Delhi [India], December 14 : India's next phase of economic growth will depend on steady and strong investment across public, private, and foreign channels, according to the Confederation of Indian Industry (CII). CII, in a release, laid out a detailed plan for the Union Budget 2026-27, saying that the Budget needs to act as both a stabiliser and a growth driver.
CII Director General Chandrajit Banerjee said the coming Budget must focus on boosting investments to keep India's growth steady. He explained that public spending has pushed the country's recovery after the pandemic, and that continued support in this area will help India stay on track as one of the fastest-growing major economies.
CII has suggested raising central capital expenditure by 12 per cent and increasing support to states by 10 per cent in FY27. These funds, it said, should go mainly to areas where spending creates the highest impact, such as transport, energy, logistics, and the green transition. CII also recommended creating a Capital Expenditure Efficiency Framework to help select and track important projects and measure their outcomes more clearly. Along with this, it proposed launching a new Rs 150 lakh crore National Infrastructure Pipeline for 2026-32 to give long-term clarity to investors and states.
The release also noted that India needs a more flexible fiscal policy. CII suggested shifting from strict annual deficit rules to a debt framework that adjusts with economic cycles. This, it said, would help the government respond better during shocks without losing long-term stability.
On private investment, CII highlighted that India now needs strong momentum from businesses to support growth. "The Government of India has provided a big demand push via income tax relief in last year's Union Budget and recently via GST 2.0. Investments, especially private sector investment, will be the next big driver for economic growth that needs to be focused on in the next fiscal to continue the growth momentum," Banerjee said.
CII recommended tax credits or easier compliance for companies that increase investments or production, along with returning accelerated depreciation to help firms, especially MSMEs, modernise.
To attract long-term global capital, CII proposed creating an NRI Investment Promotion Fund with partial government holding. This fund would help channel NRI and foreign institutional money into areas like infrastructure and AI. It also suggested strengthening the National Investment and Infrastructure Fund through a new Sovereign Investment Strategy Council to guide investments.
CII further called for simpler external borrowing rules and a single-window system for large foreign investment proposals to reduce delays and increase certainty. It also suggested forming an India Global Economic Forum to allow structured discussions between global investors and government leaders.
"An investment-driven growth strategy, anchored in fiscal credibility and institutional reforms, will define India's next development phase," Banerjee said.
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