NEW DELHI: The Confederation of Indian Industry (CII) urged the government to launch a second version of the National Infrastructure Pipeline (NIP) with a corpus of ₹150 lakh crore to sustain ongoing capital expenditure, adding that India Inc’s business confidence in the country’s growth story is the highest in five quarters.
CII’s Business Confidence Index in the third quarter of the current financial year (Q3FY26) rose for the third consecutive quarter to 66.5 from 66.0 in Q2FY26, reflecting stronger domestic demand and improving business sentiments. It conducted the 133rd business outlook survey in December 2025, covering over 175 firms of varying sizes.
“The steady rise in business confidence shows industry’s ability to navigate external headwinds anchored by resilient domestic demand and a robust reform agenda,” CII director general Chandrajit Banerjee said. The industry anticipates the growth momentum to strengthen further in the months ahead, he added.
According to the National Statistical Office’s (NSO) first advance estimates of gross domestic product (GDP) released on January 7, the Indian economy is expected to grow at 7.4% in 2025-26, led by manufacturing, services, and the government’s capital expenditure. About a month ago, on December 5, the Reserve Bank of India (RBI) projected India’s GDP growth for 2025-26 at 7.3%.
On Thursday, International Monetary Fund (IMF) director- communications Julie Kozack said, “India is a key growth engine for the world.” Saying that India’s third-quarter growth came out “stronger than expected”, she said that it may see IMF upgrading its earlier forecast of 6.6% for the country in FY26.
”Driven by bold reform initiatives, India has firmly established itself as the world’s fastest-growing major economy, demonstrating remarkable resilience amid global uncertainty shaped by geopolitical tensions, trade weaponisation, and a slowing world economy,” CII said in a statement.
Domestic demand remains the key driver, with two-thirds of firms reporting higher demand in Q2FY26 and 72% expecting further growth in Q3FY26, aided by GST rate cuts and festive consumption, it said. “Investment and hiring intentions remain robust,” it added.
CII expressed confidence that the reform momentum would continue in the forthcoming Union Budget scheduled for February 1. CII has recommended that the government sustain capital expenditure by launching a revitalised ₹150-lakh crore NIP 2.0. “The focus should be on shovel-ready, revenue-generating projects and streamlined dispute-resolution mechanisms to accelerate infrastructure delivery and crowd-in private investment,” it said.
“In parallel, CII calls for robust development and strategic funding mechanisms to enhance India’s long-term competitiveness. At the heart of this is the creation of an India Development and Strategic Fund (IDSF), which can be a sovereign-anchored platform to mobilise large pools of domestic institutional capital and foreign investment,” it said.
To strengthen India’s global integration, CII recommended enabling trade and exports through a simplified three-tier tariff structure, with low tariffs on inputs and moderate tariffs on intermediates, to enhance competitiveness, integrate into global value chains, and promote export diversification.