Sitharaman Urges India Inc to Invest Boldly and Expand Manufacturing Capacities

Finance Minister Nirmala Sitharaman on Thursday called on Indian industry leaders to seize the moment and ramp up investments to expand production capacities, asserting that the government has met corporate expectations through sustained reforms. Speaking at the IFQM Symposium, she emphasised that the Narendra Modi administration has delivered on key demands, including easing business regulations, streamlining tax systems, liberalising foreign direct investment (FDI), and crafting industry-friendly policies. “I hope there is no more hesitation for the industry to invest further and produce more in India,” Sitharaman said, urging businesses to articulate any additional support needed.

Addressing a query from Tata Sons Chairman N Chandrasekaran, Sitharaman highlighted the government’s proactive stance, noting that Prime Minister Modi has consistently prioritised reforms aligned with industry wishlists. She also encouraged year-round engagement with the government beyond pre-budget consultations and stressed collaboration in skilling India’s youth to meet workforce demands.

With India’s GDP growth projected at 6.5-7% for FY26 by the Reserve Bank of India, she underscored the pivotal role of Micro, Small, and Medium Enterprises (MSMEs), which contribute nearly 30% to GDP, and highlighted the Small Industries Development Bank of India’s (SIDBI) physical presence in MSME clusters to bolster financing access.

Chandrasekaran echoed the minister’s optimism, describing the domestic and export markets as offering “enormous” opportunities for entrepreneurs, SMEs, and large corporates. “Without investment, we will not be able to capture the opportunity,” he said, citing global demand for resilient supply chains as a chance for India to shine under Modi’s leadership. He pointed to initiatives like the Production Linked Incentive (PLI) scheme, which has driven $20 billion in investments across sectors like electronics and pharmaceuticals since 2020, as evidence of India’s growing appeal.

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Sitharaman’s call comes amid India’s push to become a $5 trillion economy by 2027, with manufacturing targeted to contribute 25% of GDP under the ‘Make in India’ initiative. Despite challenges like global economic slowdowns and a 3% dip in private capital expenditure in FY25, recent policy measures—such as corporate tax cuts to 22% and FDI inflows of $70 billion in 2024—signal robust government support.

Industry leaders now face the challenge of translating these enablers into tangible growth, particularly in high-potential sectors like semiconductors, green energy, and defence manufacturing.

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