INDIA'S INVESTMENT RATE EXPECTED TO SURGE TO 36.2% OF GDP BY 2026-27, REPORTS MORGAN STANLEY

The Indian government’s interim budget for fiscal year 2024-25 proposed an 11.1% rise in capital expenditure to Rs 11.11 lakh crore, aimed at enhancing long-term physical assets

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In a recent report by multinational investment bank Morgan Stanley, India’s investment rate is forecasted to accelerate to 36.2% of GDP by the fiscal year 2026-27, up from 32.2% in 2022-23. The recovery in capital expenditure, particularly since the onset of the pandemic, has been primarily driven by the government’s emphasis on capital spending.

The government’s commitment to boosting capital expenditure was evident in the interim budget presented on February 1, which proposed an 11.1% increase in capital expenditure outlay to ₹ 11.11 lakh crore for the fiscal year 2024-25. Capital expenditure, often referred to as capex, is directed towards establishing long-term physical or fixed assets.