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MARCH 2026

Manufacturing and Services FY25, reflecting a CAGR of about 8.4 per cent over
Drive Corporate Asset Creation FY19–FY25. In the post-pandemic period, investment rose
from Rs 3.3 lakh crore in FY23 to Rs 4.3 lakh crore in FY25,
corresponding to a CAGR of about 14.0 per cent. This
An examination of the sectoral distribution of investment
reveals notable differences in the contribution of steady expansion reflects sustained capacity creation in
manufacturing, services, and electricity & gas to areas such as information technology, telecommunications,
corporate asset creation over time. While the aggregate logistics, and other business services, providing a
trend in investment has been discussed earlier, the stabilising contribution to overall corporate investment.
sectoral breakdown helps identify the sectors driving
corporate capital formation. Investment in the electricity and gas sector has grown
steadily, increasing from Rs 0.2 lakh crore in FY19 to Rs 0.7
Manufacturing remains the dominant contributor to lakh crore in FY25, implying a CAGR of about 30.1 per cent.
corporate investment over the period. Gross investment The pace has continued in the post pandemic period with
in the sector increased from Rs 3.7 lakh crore in FY19 to CAGR of 22.6 per cent. This reflects continued capital
Rs 5.4 lakh crore in FY25, reflecting a CAGR of about 6.3 formation in power generation, transmission, and
per cent, and accounting for just over half of total distribution infrastructure. Sustained investment in this
corporate investment by the end of the period. The sharp sector is critical for the broader economy, as reliable
movements in manufacturing investment during FY21 and energy supply underpins industrial production, supports
FY22 largely reflect pandemic-related disruptions rather the expansion of modern services, and enables overall
than underlying shifts in investment trends. Investment economic growth.
rose to Rs 6.2 lakh crore in FY21 before contracting by
Rs 1.2 lakh crore in FY22. This most likely reflect Manufacturing continues to account for
accounting adjustments associated with CWIP the largest share of corporate investment,
capitalisation, asset disposals, and pandemic-related
write-offs. In the post-pandemic period, investment has while services investment has expanded
recovered steadily, increasing from Rs 5.0 lakh crore in steadily in recent years
FY23 to Rs 5.4 lakh crore in FY25, reaffirming the sector’s
central role in driving corporate capacity expansion. A similar sectoral pattern is observed in the case of net
investment. Manufacturing continues to account for the
The services sector shows a relatively stable and steadily largest share, with net investment rising from Rs 1.9 lakh
rising pattern of investment. Gross investment increased crore in FY19 to Rs 3.5 lakh crore in FY25, representing
from Rs 2.6 lakh crore in FY19 to Rs 4.3 lakh crore in around half of total net investment in the latter year.

Sectoral Trend in Private Investment (Rs lakh crore)

12.0 10.5
9.3
10.0 8.8
7.8
8.0 6.5 6.6 7.1
1.3 3.3 3.7 4.3 5.1 5.4
6.0
2.6 3.4 3.2 3.2 3.3 2.9
4.0 2.5 1.9 2.2

2.0 3.7 3.3 6.2 5.0 5.0 5.4 1.5 2.1 0.8 2.0
3.3 1.9 2.9 2.9 3.5
0.0 1.4 0.8 1.2
-1.2
-2.0
FY 19 FY 20 FY 21 FY 22 FY 23 FY 24 FY 25 FY 19 FY 20 FY 21 FY 22 FY 23 FY 24 FY 25

Gross Investment NET Investment
(GFA+CWIP) (NFA+CWIP)
Manufacturing Services Electricity & Gas Total

Source: CII research based on CMIE Prowess Database

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