New Delhi [India]: Private investment in India is poised to reach its highest level in eight years as a percentage of GDP in FY24, according to a report by the State Bank of India (SBI).
The report highlighted a strong revival in private corporate investments, with projections showing the private investment-to-GDP ratio nearing 12.5% in FY24.
Key Highlights:
- Private Corporate Investment Surge:
The private investment-to-GDP ratio in FY23 reached 11.9%, marking the highest level since FY16. The figure for FY24 is anticipated to approach 12.5%, the highest in nearly a decade. - Government Investments:
Government investments also achieved a significant milestone, contributing 4.1% of GDP in FY23—the highest since FY12. - Investment Announcements:
In the first nine months of FY25 (April–December 2024), India Inc. announced investments exceeding ₹32 lakh crore, reflecting a 39% increase compared to ₹23 lakh crore during the same period last year. - Private Sector Dominance:
Private sector participation accounted for approximately 70% of the investment announcements during this period, underscoring growing confidence in the economic outlook. - Growth in Gross Block:
Around 4,500 listed companies collectively expanded their gross block to ₹106.5 lakh crore as of March 2024, compared to ₹73.94 lakh crore in March 2020. This represents an annual addition of over ₹8 lakh crore in the past five years. - Capital Work in Progress:
A robust pipeline of ₹13.63 lakh crore in capital work under progress as of March 2024 signals sustained momentum in future investments.
Economic Implications
The surge in private investments is attributed to supportive government policies, including infrastructure development initiatives. This revival in corporate confidence is expected to bolster economic growth, enhance job creation, and lay a resilient foundation for India’s economic trajectory.
Conclusion
With private investments reaching record levels and government investments complementing this growth, the Indian economy is on track for sustained development. The strong pipeline of investments underscores a positive outlook, setting the stage for long-term prosperity.