Finance Minister Nirmala Sitharaman has told corporate India that private investment must now take the lead in driving growth. The government, she said, has carried the capital spending cycle long enough.

Speaking at the Kautilya Economic Conclave in New Delhi on October 3, she said research is where companies must step up most. India spends just 0.83 per cent of GDP on research and development, she noted.

That is less than a third of the OECD average of 2.7 per cent. Private firms account for only about 36 per cent of India’s research spending. In most large innovating economies, the private share is far higher.

Sitharaman pointed to the Rs 1 lakh crore Research, Development and Innovation scheme as the government’s main tool for the shift. Her slogan: move from “Made in India” to “Imagined and Made in India.”

The Centre has budgeted Rs 12.22 lakh crore for capital spending in FY27. Including grants to states, the figure is Rs 17.15 lakh crore, or 4.4 per cent of GDP. The fiscal deficit target is 4.3 per cent.