CII proposes reforms to spur investment-led growth in upcoming Union Budget, Pg10

Key Highlights:

• CII proposed reforms for Union Budget 2026-27 to boost investment-led growth.
• Proposed increasing Central capital expenditure by 12% and support to States by 10% in FY27.
• Suggested launching a ₹150 lakh crore National Infrastructure Pipeline (NIP) 2.0 for 2026–32.
• Recommended establishing an NRI Investment Promotion Fund.

Detailed Insights:

• The CII recommendations aim to sustain India's economic growth by promoting public, private, and foreign investments.
• NIP 2.0 seeks to build on the existing infrastructure pipeline to further enhance connectivity and economic activity.
• The proposal includes offering tax credits or compliance relaxations for firms achieving significant new investment and production targets.
• Reinstating accelerated depreciation benefits would incentivize capital expenditure and technology upgrades, especially for MSMEs and manufacturing.
• Strengthening the NIIF with a Sovereign Investment Strategy Council (SIFC) aims to align investments with national priorities.
• The CII also advocates for an economic-cycle-based public debt framework to reinforce fiscal stability.
• Public capital expenditure has been a key driver of India’s post-pandemic recovery, making it essential to bolster such investments.

Key Concepts Involved:

• Capital Expenditure (Capex): Funds used by a company to acquire or upgrade physical assets such as property, buildings, or equipment.
• National Infrastructure Pipeline (NIP): A government initiative to provide quality infrastructure across the country.
• MSMEs: Micro, Small, and Medium Enterprises, which are important for economic growth and employment.