Investment focus: CII pitches reforms for Budget 2026-27; industry body seeks capex push

The Confederation of Indian Industry (CII) has urged the Centre to adopt a wide-ranging set of reforms in the Union Budget 2026-27 to reinforce India’s investment-led growth cycle and sustain its position as one of the world’s fastest-expanding major economies, PTI reported.In a detailed submission for the upcoming Budget, CII recommended raising central capital expenditure by 12% and increasing capex support to states by 10% in FY27, launching a Rs 150 lakh crore National Infrastructure Pipeline (NIP) 2.0 for 2026-32, and introducing incremental tax credits or compliance relaxations for companies achieving notable milestones in investment, output or tax contribution. The industry body also sought an NRI Investment Promotion Fund and the reinstatement of accelerated depreciation benefits to spur fresh capital expenditure, especially for MSMEs and manufacturing sectors, without triggering Minimum Alternate Tax (MAT) liability.CII said strengthening the National Investment and Infrastructure Fund (NIIF) through a proposed Sovereign Investment Strategy Council (SIFC) would help align investments with national economic priorities. The Union Budget for FY27 is scheduled to be presented on February 1.According to the industry chamber, replacing rigid annual fiscal-deficit rules with an economic-cycle-based public debt framework would bolster resilience and allow counter-cyclical flexibility during global shocks, while ensuring the credibility of medium-term debt sustainability.“The forthcoming Union Budget 2026-27 has to serve the dual role of stabiliser and growth enabler, and promoting investments will be one of the most critical components in this regard,” said CII Director General Chandrajit Banerjee.He added that CII’s proposals centre on fiscal prudence, capital efficiency and building investor confidence.CII stressed that public capex has been the backbone of India’s post-pandemic recovery, crowding in private investment. To improve execution, it suggested creating a Capital Expenditure Efficiency Framework (CEEF) for selecting high-impact projects and monitoring outcomes based on productivity and regional growth spillovers.The chamber said facilitating private and foreign investment will be essential in driving the next phase of expansion. It proposed tax incentives linked to new investment and production milestones in high-growth areas such as clean energy, electronics, semiconductors and logistics. It also suggested the creation of an NRI Investment Promotion Fund — a government-private entity with up to 49% government stake — to mobilise overseas and institutional capital into infrastructure and emerging sectors.Further, easing external commercial borrowing norms with higher limits, longer tenures and partial risk cover for infrastructure and manufacturing projects would improve access to foreign capital, CII said. A single-window clearance system with deemed approval within 60-90 days for large FDI proposals was also recommended to accelerate big-ticket investment decisions.To deepen engagement with global investors, CII proposed an India Global Economic Forum — a government-led platform bringing together sovereign wealth funds, pension funds, private equity firms and multinational corporations for structured dialogue with senior policymakers.“An investment-driven growth strategy, anchored in fiscal credibility and institutional reforms, will define India’s next development phase,” Banerjee said.