Recently the Ministry of Statistics and Programme Implementation (MoSPI) released the first Forward-Looking Survey on Private Sector Capex Investment Intentions. 

What is Capex?

• Capital Expenditure (Capex) refers to investments made by companies or the government in physical assets like machinery, buildings, and infrastructure, intended to increase production capacity or efficiency.
• Capex is a key driver of economic growth, job creation, and labour productivity.
• For India, high and consistent private sector Capex is vital to transition from a developing to a developed economy.

About the Survey

• Conducting Body: The survey was conducted by MoSPI, the nodal agency for statistical data in India.
  • MoSPI operates under the Collection of Statistics Act, 2008, which mandates the collection of economic and social data.
  • It also mandates data submission by enterprises for national policy use.
• Survey Coverage
  • Time Period: Conducted between Nov 2024 – Jan 2025.
  • Scope: Covered Capex trends over five years with actual data for FY22, FY23, FY24, and projected figures for FY25 and FY26.
  • Participation: Out of 3,064 enterprises surveyed, 2,172 shared complete five-year Capex data.
• Key Observations
• • Capex increased by 66% between FY22 and FY25.
  • Including FY26, overall growth drops to 23%, showing volatility.
  • This underscores the inconsistent growth in private investment.
• Comparison with Public Sector Capex
  • Government Capex grew by 230% from FY21 to FY25, showcasing a strong fiscal-led growth model.
  • The Centre has consistently encouraged private sector participation through policy incentives, PLI schemes, and infrastructure push.
• Challenges of the Survey
  • Companies cited legitimacy and cyber-risk concerns in sharing data.
  • MoSPI cautioned that, being the first iteration, findings are indicative and subject to refinement.

Significance of the Survey

• This marks a significant step toward systematically tracking private sector capital expenditure (Capex), critical for understanding economic growth patterns in India.
• Policy Relevance
  • Helps government and corporations make informed investment decisions.
  • Enables better forecasting of economic trends and job creation potential.
  • Supports the national goal of becoming a $5 trillion economy.
• Strategic Implications
  • In a time of global economic uncertainty, tracking Capex helps India fine-tune its macro-economic planning.
  • Supports institutions like NITI Aayog and the Finance Ministry in designing targeted interventions.

Conclusion

The launch of a formal mechanism to track private sector Capex is a forward-looking governance reform. While initial data indicates uneven investment patterns, the survey lays the groundwork for a robust database that can guide India’s development journey in the coming decades.

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