In a first, govt to conduct yearly private capex survey from October

At a time when the government is nudging the private sector to ramp up its capital expenditure (capex), the Ministry of Statistics and Programme Implementation (MoSPI) is poised to kick-start the first-of-its-kind annual survey on the status of private sector capex from next month.

“The inaugural edition of the annual exercise will start in October and will be completed by December. The results will be made public by February next year,” said Geeta Singh Rathore, director general, National Sample Survey Office (NSSO), at a data users’ conference on Thursday.

The survey will track the annual capex by the private sector by compiling information on the projected capital investment of the private sector for the next two years, in addition to the capital expenditure undertaken in the past three years.

"Unlike other surveys, this will be a web survey, meaning that NSO will use the company's database from the Ministry of Corporate Affairs (MCA). Field enumerators won't be going out to collect data, although our field offices will be involved in the exercise. This will be an annual survey, and the sample size would be 6,000-7,000 entities,” Rathore explained.

The survey comes at a time when the government is pushing hard to boost economic growth by ramping up public capital expenditure as the revival in private investment remains uncertain. In July, the Economic Survey 2023-24 noted visible green shoots in private capex but urged caution.

“Improved balance sheets will help the private sector cater to strong investment demand. However, a note of caution is warranted here. Private capital formation, after good growth in the last three years, may turn slightly more cautious due to fears of cheaper imports from countries with excess capacity,” the survey noted.

A recent study by the Reserve Bank of India (RBI) has projected private sector capital expenditure to increase by 54 per cent to Rs 2.45 trillion in 2024-25 as against Rs 1.59 trillion in 2023-24.

This rise is due to the rising domestic demand, improved corporate profitability, sustained credit demand, business optimism, and the government's focus on infrastructure development, the study noted.

RBI Governor Shaktikanta Das said in August that "private corporate investment is gaining steam on the back of expansion in bank credit".

According to the latest national accounts data released on August 30, growth in gross fixed capital formation — a proxy for investments — increased to 7.5 per cent in Q1FY25 from 6.46 per cent in the preceding quarter. Experts have attributed this rise to increased capex by the private sector and households.

The annual private capex survey will run in conjunction with the annual survey of industries, which tracks output, value-added, and employment across manufacturing sector enterprises.