Growth plan: Capex, jobs, social spend

Emphasis on public capex in FY27 could catalyse the recovery in private investment that began in mid-FY26, supporting job creation—particularly in manufacturing sectors capable of absorbing India’s semi-skilled workforce. By my estimates, domestic private investment announcements rose by 25 percent year-on-year in FY26, with nearly ₹5 lakh crore worth of stalled projects recommissioned, compared to ₹2 lakh crore in the previous year. FY27 could carry forward this corporate confidence, especially as domestic demand continues to strengthen.

FY27 could mark a shift towards broader regulatory easing aimed at lowering capital costs and stimulating private investment. Large-ticket consumer sectors—such as automobiles and housing—are likely to benefit as employment conditions improve and household cash flows strengthen. Gold prices may not see a correction in the near term, at least until the US mid-term elections.

To conclude, I align with the policy strategy of empowering corporate India. Catalysts include public capital expenditure, production-linked incentives, MSME credit guarantees and regulatory easing. A healthy private sector is needed to generate the scale of employment required for India to transition into a middle-income economy.

Leveraging India’s demographic dividend is the need of the hour. While the country rightly takes pride in its large youth population—comparable to the entire US population—it also faces one of the highest levels of youth unemployment. This challenge has intensified each year. Investments in social development will yield a more productive workforce over the next decade or two. Still, the immediate imperative for a capital-deficient economy like India is job creation. Policies that accelerate private investment and employment generation must take precedence today, while longer-term social outcomes can continue to be built in parallel.

Debopam Chaudhuri | Chief Economist, Piramal Enterprises

(Views are personal)