RBI Sees Private Capex Rising 21.5% to ₹2.67 Lakh Crore in FY26

Private capital investment in India is expected to record a sharp rise in the coming financial year, with the Reserve Bank of India (RBI) projecting a 21.5% increase. According to the central bank’s latest analysis, private corporate capital expenditure (capex) could reach ₹2,67,432 crore in FY26, compared with ₹2,20,132 crore in FY25.

Capital Investment Outlook for FY26

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The projected increase reflects improving corporate health, stronger balance sheets, and higher profitability among private companies. Analysts note that firms are entering the new fiscal year with renewed optimism, backed by a supportive policy environment and a steady improvement in overall demand conditions.

The RBI’s estimates indicate that the jump in private capex will be led by long-term projects, especially those in sectors linked to infrastructure development. This is seen as a signal of rising business confidence and sustained recovery in corporate spending patterns.

Supportive Macroeconomic Environment

Several factors are contributing to the favourable investment outlook. A 100 basis point cut in policy rates has lowered borrowing costs, while inflation trends continue to ease. Higher capacity utilisation and comfortable liquidity in the financial system are also encouraging companies to commit to fresh investments.

Experts highlight that these conditions have created an enabling ecosystem for private sector-led growth. With the government maintaining its focus on infrastructure, the private sector is expected to step up with larger contributions to capacity expansion.

Sectoral Push and Funding Sources

The infrastructure space, particularly the power sector, is likely to draw a major share of fresh investment. Funding data compiled from banks, financial institutions, external borrowings, and equity issuances shows a broad-based pattern of financing activity. New projects, including several greenfield ventures, are adding further momentum to this trend.

While the overall push suggests a cyclical recovery, the rise in commitments also points towards structural improvements in the investment climate, which could translate into durable long-term capacity building.

Risks and Challenges Ahead

Despite the positive outlook, global headwinds cannot be ignored. Geopolitical uncertainties, weaker global demand, and trade-related pressures remain potential risks. The timely execution of planned projects will be crucial in sustaining growth, making continued policy support and efficient monitoring key to success.

Conclusion

With private capex projected to climb 21.5% to ₹2.67 lakh crore in FY26, India’s investment story appears to be entering a stronger phase. Although external risks linger, domestic financial stability, robust corporate health, and an infrastructure-driven growth model are expected to keep the momentum intact.