Finance Minister Nirmala Sitharaman Urges India Inc to Invest More and Expand Capacities

Finance Minister Nirmala Sitharaman has called on Indian industry to increase investments and expand manufacturing capacities, emphasizing the government’s commitment to supporting industrial growth through policy reforms and active engagement. Speaking at various industry forums in September 2025, she urged businesses to accept advantage of a favorable economic environment and partner with the government on skilling initiatives and long-term development goals.

Addressing corporate leaders at the Economic Times Awards for Corporate Excellence in Mumbai, Sitharaman acknowledged challenges hindering expansion but pledged a patient hearing for industry concerns. “We are certainly willing to hear any difficulty that stops Indian industry from expansion or capacity building or investing in newer technologies, artificial intelligence,” she said, adding, “Tell us what you (industry) need. Tell us what you want us to do, so that you feel incentivized to further invest and grow equally.”

She highlighted that the government remains committed to cushioning vulnerable sections, such as farmers, from rising input costs due to global conflicts, without deviating from its fiscal consolidation path. The Centre aims to contain its FY27 fiscal deficit at 4.5% of gross domestic product.

Sitharaman pointed to India’s significant imports of finished and intermediate goods as an opportunity for domestic manufacturing, urging industries to produce these products locally to reduce import reliance. She also stressed that strong macroeconomic fundamentals, while important, do not automatically guarantee large foreign investment inflows, noting that investor decisions are influenced by multiple factors beyond economic indicators.

At the IFQM Symposium in New Delhi, the Finance Minister reiterated her appeal for industries to shed hesitation and invest more, underlining that the Modi government has delivered on key reforms demanded by businesses. She cited GST cuts worth ₹2 lakh crore as a measure set to boost disposable incomes and stimulate demand.

Sitharaman emphasized the need for a long-term growth vision that extends beyond infrastructure to include quality improvements in manufacturing and the service sector. She noted the government’s focus on ease of doing business, tax reforms, FDI liberalization, and MSME support, stating that industry plays a crucial role in India’s journey toward becoming a developed nation.

She also highlighted the enhanced role of the Small Industries Development Bank of India (SIDBI), which has been given a stronger physical presence in MSME hubs to strengthen grassroots-level businesses and improve access to credit.

Global agencies remain cautiously optimistic about India’s private investment cycle. S&P Global has projected that Indian firms could invest up to USD 850 billion over the next five years, though large private capacity additions may take time. Crisil’s chief economist D.K. Joshi observed that while private investment is rising, it is not yet keeping pace with nominal GDP growth due to global uncertainties such as shifting trade policies, and tariffs.

Throughout her engagements, Sitharaman encouraged industry to engage with the government year-round, not just before the Budget, and to partner in skilling the youth for faster employment and inclusive growth.