New Delhi [India], November 2 (ANI): Union Finance Minister Nirmala Sitharaman on Monday acknowledged concerns among foreign portfolio investors (FPIs) and equity market participants over India’s investment environment, saying the government recognises the changing global circumstances and will consider their feedback as the country seeks to sustain growth above 7 per cent.
Speaking at the Financial Express Leadership Awards 2026, Sitharaman said taxation was only one aspect of attracting foreign investment and noted that the tax structure was similar in 2023-24, when India recorded strong foreign capital inflows.
“Nothing differently was done for drawing investments. But of course, the situation is very different now. Circumstances have changed. Challenges have grown,” she said, acknowledging that net FII outflows had increased, although inflows had started recovering.
She said India required capital, particularly equity investments, to sustain its growth momentum. While the government had focused on deepening and widening the bond market in recent years, concerns were now being raised about the need for greater support for equity markets.
“I wouldn’t want to say more at this stage, but I recognise the voice,” she said, referring to investor concerns.
On domestic economic conditions, Sitharaman said she expected India’s consumption story to remain intact, citing the latest GST collection figures as an indication of sustained demand. She said consumption and demand had become more visible following the implementation of the next-generation GST reforms, encouraging companies to consider fresh investments.
The Finance Minister also said private sector investment was picking up, although companies were choosing sectors selectively. She attributed this improvement partly to greater visibility of demand in the market.
On employment, she highlighted the need to bridge the gap between the skills of young graduates and industry requirements. She said the government had been working on skilling initiatives over the last two budgets and stressed the importance of preparing workers to use artificial intelligence across industries, including micro, small and medium enterprises.
Sitharaman also defended the government’s production-linked incentive (PLI) approach, saying companies received incentives based on additional production. While the scheme had delivered results in some sectors, she acknowledged that its performance had been weaker in others and would need to be examined.
She further pointed to reforms in government procurement, tendering procedures and project execution, saying these had been made more business-friendly. She urged industry representatives to maintain regular engagement with the government to communicate their investment plans and challenges. (ANI)
Related reading
