CII Urges Gradual Fuel Excise Rollback Amid 67% Spike in Private Sector Capex

Written by: Team Angel OneUpdated on: 11 May 2026, 5:10 pm IST
India’s private capex increased to ₹7.7 lakh crore in September 2025, with Confederation of Indian Industry (CII) outlining measures on fuel and supply chains.
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India’s Private Sector Capital Expenditure Increased to ₹7.7 lakh crore in September 2025, compared with ₹4.6 lakh crore in the year-ago period, according to the Confederation of Indian Industry (CII). 

The industry body said the 67% increase was based on an assessment of nearly 1,200 companies from the CMIE Prowess database. The calculation included annual changes in net fixed assets and capital work in progress. 

Manufacturing Remains Main Contributor 

Manufacturing accounted for ₹3.8 lakh crore of the overall private investment recorded during the period. Sectors such as metals, automobiles, and chemicals saw higher spending on expansion and ongoing projects. 

Services contributed around ₹3.1 lakh crore, or about 40% of total private capex. Trading firms, communication companies, and IT and ITeS businesses were among the larger contributors in the segment. 

CII said the latest numbers show continued investment activity across sectors during FY26. 

Capacity Use and Lending Show Improvement 

Manufacturing capacity utilisation rose to 75.6% in the third quarter of FY26 from 74.3% in the previous quarter, according to the industry body. 

New order books grew 10.3% year-on-year during the same period. Bank credit growth also improved in the second half of the financial year. 

CII said lending growth averaged close to 14% in the second half of FY26, compared with around 10% during the first half. 

Industry Body Suggests Excise Rollback 

Alongside the investment data, CII released a 5-point agenda linked to global supply concerns and the ongoing situation in West Asia. 

The industry body recommended a phased withdrawal of the ₹10 per litre central excise duty reduction on petrol and diesel over 6 to 9 months if crude oil prices stabilise. 

CII also suggested that larger companies adopt a voluntary 45-day payment cycle for MSMEs using the TReDS platform and supply-chain financing mechanisms. 

Other proposals included reducing fuel and power consumption by 3 to 5% over the next 2 quarters and increasing domestic sourcing of components, capital goods and specialty chemicals to reduce supply disruptions. 

Conclusion  

CII’s latest data showed higher private investment activity across manufacturing and services during FY26. The industry body also outlined measures related to fuel taxes, MSME payments, and supply-chain amid global uncertainty. 

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.   
 
Investments in the securities market are subject to market risks, read all the related documents carefully before investing. 

Published on: May 11, 2026, 11:40 AM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

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