India’s Private Capex To Fall 16.5% to Rs 9.55 Lakh Crore in FY27: Govt Survey
Firms stay cautious, rely on internal funds, focus on core assets and upgrades
New Delhi: The government on Tuesday said that India’s capital expenditure or capex by the private sector on acquisition of new assets is estimated to decline by 16.5 per cent to Rs 9.55 lakh crore in 2026-27, according to a survey conducted by the Ministry of Statistics & Programme Implementation.
As per the survey, the provisional aggregated capital expenditure on acquisition of new assets in 2025-26 is estimated at Rs 11.43 lakh crore. “Out of the 5,366 operational enterprises that responded to the survey, 4,203 (about 78.3 per cent) reported their capex investment plans for the next financial year (2026-27),” the survey showed.
It also stated that responses were sought from 7,486 enterprises - 5,795 enterprises in the census sector and 1,691 enterprises in the sample sector. “Enterprises generally tend to adopt a conservative approach in reporting such estimates for a future year,” it said.
The actual capex incurred during 2024-25 was Rs 173.5 crore per enterprise against an intended Rs 180.2 crore as reported in the CAPEX-2024 survey, resulting in an overall realisation ratio of 96.3 per cent. “This indicates that the actual expenditure was broadly in line with the investment intentions at the aggregate level for the panel of enterprises,” it said.
As per the survey estimates, the strategy of investment for about 48.63 per cent of enterprises during 2025-26 was focused on core assets, while 38.36 per cent planned investments for value addition to existing assets. “Around 14.54 per cent undertook investments in opportunistic assets, less than 4 per cent followed debt-related strategies, and about 1.0 per cent pursued strategies involving distressed assets or non-performing loans,” it said.
In addition, it also stated that 20.15 per cent of enterprises did not report any specific investment strategy from the listed options. “During 2025-26, about 60.13 per cent of enterprises in the private corporate sector undertook capital expenditure primarily with the objective of income generation, while 42.12 per cent reported capex for upgradation of existing capacity,” it said.
Around 7.2 per cent of enterprises incurred capex with the objective of diversification, and about 17.64 per cent reported other reasons not specifically captured in the survey. “Internal accruals constitute the primary source of capex financing in the private corporate sector during 2025-26, accounting for 65.35 per cent of the total investment,” the survey indicated.
Domestic debt, it said, is the second-largest source, contributing 23.25 per cent, followed by equity raised within the country at 3.78 per cent. “External sources play a relatively smaller role, with 1.04 percent of capex financed through the FDI route and 2.38 percent through foreign debt,” it added.