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Govt firms drove pre-election capex
May 27, 2025
|Mint Ahmedabad
Steering the ship
Investment in new factories, buildings, and equipment surged in FY24, powered largely by central and state governments and public sector enterprises, while private corporations held back amid election-year and demand-related uncertainties, new government data shows.
After a strong rebound in private capital expenditure in the two years following the pandemic, investment by private non-financial corporations stagnated in FY24.
In contrast, capital spending by public non-financial enterprises jumped 33%, while central and state governments increased theirs by 25%.
The shift in momentum underscores the continuing reliance on government-led spending to drive capital formation in politically sensitive periods, with corporate India adopting a cautious, wait-and-watch stance.
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