NEW DELHI — The Reserve Bank of India (RBI) projected private‑sector capital expenditure at ₹3.2 lakh crore for the 2026‑27 fiscal year, according to a data release on 25 September 2026. The estimate represents a rise of roughly 12 % over the previous year’s private capex of ₹2.86 lakh crore and accounts for about 45 % of total projected capital formation in the economy.
Private capex outlook
The RBI’s projection was part of its quarterly review of capital formation trends. The central bank said the upward trajectory reflects sustained corporate confidence, higher demand for production capacity and continued government incentives for private investment. The estimate covers spending by corporations, partnerships and sole proprietorships on plant, machinery, equipment and infrastructure assets, but excludes public‑sector projects.
Sectoral drivers
Manufacturing is expected to contribute the largest share, with firms in automotive, chemicals and pharmaceuticals planning to expand capacity. The RBI noted that the “Make in India” initiative, renewed in 2025, has spurred new plant setups in tier‑2 and tier‑3 cities. Infrastructure spending, particularly in renewable energy, logistics parks and urban transit, is also slated to rise, supported by the government’s ₹1.5 lakh crore green‑energy fund announced in early 2026.
Digital and technology investments are gaining prominence. An Economic Times analysis highlighted that hyperscale cloud providers’ global capex forecasts of $990 billion are being questioned, with analysts pointing to India’s “reverse AI” advantage – a trend where Indian firms are exporting AI services rather than importing them. While the Economic Times piece did not provide a specific figure for AI‑related private capex, it underscored the sector’s growing share of overall investment.
Commercial fundraising surge
Commercial fundraising activity in the private sector accelerated sharply in the four‑month period ending March 2027 (4MFY27). SBICAPS data released by Fortune India showed a 138 % increase, with companies raising ₹10.6 lakh crore through debt and equity instruments. The surge was led by mid‑size manufacturers and technology firms that tapped both domestic and overseas capital markets. The fundraising boost is expected to feed directly into the projected capex increase, as firms convert raised funds into tangible assets.
Analyst observations
Industry analysts, citing the RBI data, said the private‑sector capex outlook suggests a modest but steady contribution to GDP growth, which the government targets at 6.5 % for FY 2026‑27. The RBI’s estimate aligns with its earlier forecast that private investment would offset a slowdown in public‑sector spending caused by fiscal consolidation measures announced in the 2025 budget.
Financial institutions are monitoring credit conditions closely. The RBI indicated that while overall credit growth remains healthy, banks are tightening underwriting standards for high‑risk sectors, which could temper the pace of new projects in those areas.
Policy context
The projection comes as the government continues to implement reforms aimed at easing land acquisition, streamlining environmental clearances and expanding the Production‑Linked Incentive (PLI) scheme across additional sectors. The RBI’s quarterly bulletin noted that these policy measures are expected to reduce project lead times and improve the investment climate for private firms.
Overall, the RBI’s estimate of ₹3.2 lakh crore in private capex underscores a continued reliance on private capital to drive India’s economic expansion, complementing public‑sector initiatives and supporting the country’s ambition to become a top‑five global economy by 2030.
