New Delhi – The Confederation of Indian Industry (CII) has unveiled a comprehensive five-point action plan designed to help India navigate economic challenges stemming from the ongoing West Asia crisis. A key proposal within this plan includes the phased restoration of the Rs 10 per litre excise duty cuts on petrol and diesel.
This strategic move comes as India's private capital expenditure demonstrated robust growth, rising 67 percent year-on-year to Rs 7.7 lakh crore in September 2025, up from Rs 4.6 lakh crore a year prior. CII views this significant increase as a clear indicator of a broad-based revival in the nation's investment cycle.
CII's Five-Point Plan for Economic Resilience
The industry body's proposals aim to strengthen India's economic resilience in a volatile global environment. The five key recommendations are:
- Phased Fuel Excise Withdrawal: A gradual rollback of the Centre's excise duty reductions on petrol and diesel over six to nine months, aligning with global crude oil price stabilization.
- Voluntary Energy Conservation: An industry-wide drive for companies to commit to reducing fuel and power consumption by 3 to 5 percent over the next two quarters through measures like logistics optimization, fleet electrification, and increased use of renewable energy.
- MSME Payment Guarantee: Larger corporates to voluntarily guarantee payments to Micro, Small, and Medium Enterprises (MSMEs) within 45 days, utilizing the TReDS platform and supply-chain finance mechanisms to alleviate working capital stress.
- Deeper Supply-Chain Localisation: Calls for strategic inventory buffers, diversified sourcing, and greater domestic value addition in critical sectors such as speciality chemicals, components, and capital goods.
- Front-Loading Investments & Price Restraint: Urging industry to accelerate Fiscal Year 2027 investments in manufacturing, energy transition, and digital infrastructure, while exercising voluntary price restraint on essential inputs and expanding internship hiring under the PM Internship Scheme.
Chandrajit Banerjee, Director General, CII, emphasized the significance of recent investment trends. "The 67 percent jump in private capex to Rs 7.7 lakh crore is, by some distance, the most important signal yet that India’s investment cycle has decisively turned," Banerjee stated.
Manufacturing and Services Drive Investment Revival
CII's analysis, based on nearly 1,200 companies from the CMIE Prowess database, highlights that manufacturing contributed significantly to the total private capital expenditure, accounting for Rs 3.8 lakh crore. This was primarily led by sectors such as metals, automobiles, and chemicals. The services sector also played a crucial role, contributing Rs 3.1 lakh crore, driven by trading, communications, and IT/ITeS.
Capacity utilization in manufacturing firms saw an increase, reaching 75.6 percent in the third quarter of FY26 from 74.3 percent in the previous quarter, accompanied by a 10.3 percent year-on-year expansion in order books. Bank credit growth also averaged close to 14 percent in the second half of FY26, a notable rise from approximately 10 percent in the first half.
"Taken together, these five suggestions could add up to the industry’s concrete partnership offer to the Government in recent memory," Banerjee noted, underscoring the industry's readiness to share the burden during global uncertainties.
CII attributed the current investment revival to the government's supportive policy framework and public capital expenditure push. Key drivers cited include GST reforms, PM Gati Shakti, Production Linked Incentive schemes, labor codes, free trade agreements, and the PM Internship Scheme. Strong macroeconomic indicators, such as an average GDP growth of 7.3 percent over the past three years, easing inflation, forex reserves exceeding $700 billion, and record exports of $863 billion in FY26, further bolster investor confidence.
While spillover risks from the West Asia crisis continue to pose near-term challenges, CII believes that enhanced industry-government coordination will be crucial in safeguarding India's growth momentum and economic stability.