Introduction
Domestic investment has emerged as a central pillar of India’s economic expansion, reflecting rising confidence across households, corporates, and institutional investors. A combination of sustained macroeconomic stability, improving income growth, deepening financial markets, and expanding access to credit has supported a steady acceleration in domestic capital formation.
Public investment continues to play a catalytic role by crowding in private capital. In contrast, private investment, spanning households, corporates, and domestic institutions, has gained momentum amid healthier balance sheets and stronger profitability. Robust economic growth projections, resilient consumption demand, and increased participation of domestic institutional and retail investors have further reinforced investment activity across asset classes.
Together with supportive policy initiatives aimed at strengthening manufacturing, scaling new capacities, and upgrading infrastructure, domestic investment remains a key driver of India’s growth trajectory and long-term economic transformation.

Market Activity
According to the Ministry of Statistics and Programme Implementation (MoSPI), the Second Advance Estimates project India’s real GDP to grow by 7.6% in FY26, while nominal GDP is estimated to expand by 8.6%. Real GVA is expected to grow by 7.7%, reflecting sustained expansion in productive activity across sectors, while nominal GVA growth is estimated at 8.7%. Nominal GDP has increased significantly from Rs. 1,06,57,000 crore (US$ 1.75 trillion) in FY15 to Rs. 3,45,47,000 crore (US$ 3.91 trillion) in FY26 (Second Advance Estimates).
The International Monetary Fund (IMF), in its April 2026 World Economic Outlook, has revised India’s growth outlook upward, reflecting stronger-than-expected economic performance. Growth for 2025 has been revised up to 7.6%, supported by robust momentum in the second and third quarters and continued strength in the fourth quarter. For 2026, the IMF has moderately raised its growth forecast to 6.5%, driven by positive carryover effects from the strong 2025 performance and easing global trade pressures. Growth is expected to remain stable at 6.5% in 2027, highlighting India’s continued position as one of the fastest-growing major economies globally, supported by resilient domestic demand and favourable macroeconomic fundamentals.
Domestic Institutional Investors (DIIs) played a stabilising role in the equity cash market during FY 2025–26 (April–December 2025), recording net purchases of around Rs. 5.99 lakh crore (US$ 72.0 billion). Strong and consistent buying by mutual funds, insurance companies, and pension funds helped offset periods of foreign portfolio moderation.
According to BSE data, as of April 30, 2026, the number of registered investors on the Bombay Stock Exchange (BSE) reached 24,99,44,251, marking a 16.46% YoY and 1.05% MoM increase.
India’s primary market continued to witness strong momentum, particularly in the second half of the year, supported by rising participation from foreign and domestic institutional investors as well as retail investors. During Q3 FY 2025–26, IPO activity remained robust with 39 new listings raising nearly Rs. 98,400 crore (US$ 11.14 billion), reflecting sustained investor confidence and favourable market conditions. Cumulatively, up to December 2025, the Indian IPO market recorded more than 90 listings, mobilising nearly Rs. 1,60,000 crore (US$ 18.11 billion), highlighting healthy demand for new issues across sectors. Strong market sentiment also enabled existing shareholders to monetise investments, with Offer for Sale (OFS) accounting for a significant share of total proceeds.
In Q1 CY2026 (January–March), India recorded 316 Private Equity (PE)–Venture Capital (VC) deals valued at Rs. 82,660 crore (US$ 9.1 billion), reflecting continued investor participation despite global geopolitical uncertainties and temporary supply chain disruptions linked to the ongoing West Asia conflict. In Q1 CY2025, PE-VC investments stood at Rs. 1,01,320 crore (US$ 11.7 billion), highlighting the strong base of investment activity in the previous year. In March 2026 alone, investments were valued at Rs. 35,310 crore (US$ 3.8 billion), compared with Rs. 40,660 crore (US$ 4.7 billion) in March 2025.
Investments/developments
Through joint governmental efforts such as coordinated policy actions, supporting local production/programs, working with domestic-based financial institution capital to increase investor/investment confidence, and developing deeper trade linkages and bilateral economic partnerships through additional country-to-country agreements, the Indian domestic investment environment has been improved by better industry/market access, more industrial capabilities (in terms of products), and deeper industry relationships. The Indian government continues to support local production and investment through programs that have motivated potential domestic investors to invest in new capacity and long-term capital. The use of additional capital from existing domestic-based financial institutions further demonstrates the growing confidence of potential domestic investors in India's growth potential. Furthermore, additional trade agreements and other country-to-country bilateral economic partnerships have enhanced India's potential international export competitiveness and improved visibility for potential foreign investments. The combined efforts of the entities named above provide an excellent opportunity for India to develop its ability to attract and retain both domestic and foreign investment, regardless of the rapidly changing global economy. Some of the recent notable investments and developments are as follows:
Government Initiatives
With the government's focus on making business in India easier through the establishment of nation-specific offices to "handhold" foreign investment, India has advanced in recent years in the rankings for ease of doing business. The government has also attempted to rein in the aggressive tax administration through more openness and transparency. It has also taken multiple other initiatives to improve the business regulatory environment in the country and simplify the process of making domestic investments. Some of these are:
Road Ahead
India’s investment trajectory is expected to stay on a firm footing in FY26 and the years ahead, underpinned by consistent economic performance, predictable policymaking, and strengthening market sentiment. Public policy measures aimed at boosting domestic manufacturing and self-reliance are translating into higher capital deployment, while new-age industries such as chip fabrication, green energy, electric vehicles, and precision manufacturing are emerging as key investment magnets. These trends reflect India’s increasing integration into global value chains and its growing attractiveness as a long-term production base.
Further, ongoing improvements in the regulatory and operating environment, including streamlined tax structures, better logistics connectivity, and modernised labour frameworks, are supporting investment-led growth. The expanding role of domestic financial institutions and rising household participation in capital markets are improving the availability of risk capital and long-term funding.
Note: Conversion rate used for April 2026 is Rs. 1 = US$ 0.01071
References: Press Information Bureau (PIB), NSE, BSE, Media Reports, IVCA





