While proposed investments from domestic private investors improved 40.7 per cent to ₹34.06 trillion, foreign investors’ plans more than doubled, jumping 144.05 per cent to ₹6.91 trillion
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Private sector drove over 70% of India’s new investments in FY26, with commitments nearing ₹41 trillion as manufacturing and mega projects surged.
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The private sector firmly reassumed the driver’s seat in new capital investments in 2025-26 (FY26), with its share of new projects topping 70 per cent after several years, thanks to a sharp 51.5 per cent rise in new investment commitments that nearly breached ₹41 trillion through the year, even as government capex forays grew about 1 per cent.
Although fresh investment plans in India halved to ₹8.6 trillion through the West Asia conflict-affected January-March 2026 quarter compared to the previous three quarters’ ₹16 trillion-plus tally, the value of new projects grew a robust 32 per cent to hit ₹58.25 trillion in FY26, from ₹44.15 trillion in FY25, according to investment tracking firm Projects Today.
The number of new projects also rose 38 per cent to 16,247 from 11,720 in FY25, with the manufacturing sector recording the strongest uptick of 47 per cent. The value of new manufacturing plans surged 58.3 per cent to nearly ₹17.24 trillion from ₹10.9 trillion a year ago, with basic metals, basic chemicals, machinery and electronics players driving the boom. Vedanta’s ₹1.28 trillion aluminium smelter at Dhenkanal in Odisha was the largest single project announced in FY26.
While proposed investments from domestic private investors improved 40.7 per cent to ₹34.06 trillion, foreign investors’ plans more than doubled, jumping 144.05 per cent to ₹6.91 trillion. Overall private capex plans constituted 70.34 per cent of new investments, up from 61.23 per cent in FY25.
The value of new government projects, that had been ramped up to pump prime the economy and crowd in private capital for a few years now, touched ₹17.28 trillion, up slightly from about ₹17.12 trillion in FY25. This growth was driven by States, whose proposed outlays rose 3 per cent to almost ₹8.67 trillion, just a tad higher than the Centre’s new investments of ₹8.61 trillion.
“FY2026 recorded a strong year-on-year increase in fresh investment, led by private sector participation, a marked improvement in manufacturing, and sustained momentum in renewable power. In this sense, the year marked a clear strengthening in investment intentions compared with FY25,” noted the latest report of the firm that has been tracking investment projects since the year 2000.
A record 82 per cent of private sector projects were mega-investment projects worth Rs. 1,000 crore or more. However, the outlook for this year has turned cautious in the face of multiple global headwinds, and may necessitate stronger public sector capex again in FY27 as mega projects may be particularly risky to kick off amid greater uncertainty.
“The late-year weakness in fresh investments, triggered by geopolitical uncertainties and inflation fears amid high oil prices, assumes importance because it may influence investment trends in the opening months of FY2027. Such uncertainties tend to influence private investment decisions more quickly than public spending,” Shashikant Hegde, CEO and director of Projects Today, told Business Standard.
“The immediate outlook, therefore, points to slower and more selective investment growth rather than another broad acceleration. Under such circumstances, stronger public sector capex may be required in FY2027 to sustain the overall investment momentum,” he noted, reckoning there could be a dip in private sector investment commitments, especially for large projects, in the first half of FY2027.
There were significant shifts among the States preferred by investors in FY26, even though Maharashtra remained on top and expanded its share with outlays worth ₹11.05 trillion, up from ₹7.94 trillion in FY25. Andhra Pradesh jumped up from fifth position in FY25, nudging Maharashtra’s traditional rival for investments, Gujarat out of the second place, by securing 15.4 per cent or nearly ₹9 trillion of total outlays in FY26.
Rajasthan retained the third rank, though its share in total investment moderated from 10.54 percent to 9.12 percent, while Gujarat slipped to fourth. Odisha moved up a notch to the fifth position, even as Karnataka dropped two spots to sixth. While Madhya Pradesh continued to be the seventh preferred investment address, Telangana and Uttar Pradesh traded places in FY26 from their ninth and eighth positions in FY25, respectively. Tamil Nadu re-entered the top 10 states list in FY2026, with fresh investments rising from ₹0.98 trillion in FY25 to ₹2.29 trillion, as Chhattisgarh dropped out of the tenth position to the twelfth.
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