CII sees 6.7% growth in FY26, pitches for reforms, disinvestment, FTA leverage

The Confederation of Indian Industry (CII) expects the Indian economy to register a steady growth in the range of 6.4% to 6.7% in the current financial year (2025-26). Addressing a press conference in Delhi today, Rajiv Memani, President, CII said the apex industry body’s GDP projection is based on its GDP growth model, which uses high-frequency indicators to estimate current GDP in real time.

The model incorporates 34 monthly indicators, including global uncertainty measures, to prove the accuracy of short-term economic assessments. The GDP growth projection “reinforces India’s position as the fastest-growing major economy in the world,” Memani said. While geopolitical uncertainty continues to be a risk, India’s strong domestic demand balances it out, CII observes.

According to Memani, India needs to undertake the next generation reforms, continue focus on ease of doing business, accelerate growth of its manufacturing sector, and utilise the upcoming free trade agreements (FTAs) with key trading partners like the U.S, EU and UK to its advantage to maintain the pace of economic growth. “Competitiveness is India’s passport to prosperity. But it must be earned through reform, through innovation, and through trust. CII remains committed to working alongside the government, industry, and citizens to accelerate India’s rise as a confident, competitive, and globally connected economy,” Memani said.

GST rate rationalisation, streamlining of input credits to avoid delays, etc., are some of the measures suggested to improve ease of doing business.

CII has suggested the establishment of state fiscal councils to independently assess state budgets, debt sustainability, fiscal risks, etc. It has recommended a credit rating system for states and suggests linking borrowing costs of states to fiscal performance to encourage prudent finances.

The industry body also proposed calibrated disinvestment of public sector enterprises (PSEs) to enable the government to augment its revenues to meet the country’s developmental and infrastructure needs. “About 10% of the total market capitalisation, which is about ₹55 lakh crore, rests with PSEs. We could look at divesting about 10% of this market cap, which could yield about ₹5 lakh crore. These proceeds could be utilised for -- enhancing public capex, retiring government debt, setting up a Sovereign Wealth Fund for investing in strategic assets overseas and acquiring critical technologies,” Memani said.