The Reserve Bank of India (RBI) has stated in its February bulletin that the upcoming round of capital expenditure (capex) by the corporate sector is likely to drive the next phase of economic growth in India. The report highlights that balance sheets are robust, with high profits, constant or improving leverage, and multi-year high return ratios. While sectors like oil, gas, and chemicals show notable fixed asset growth, steel and automobiles lag in fixed asset additions. The RBI encourages the corporate sector to take advantage of a lower budgeted borrowing program and easing borrowing costs. The report also notes favorable inflation developments, providing a stable environment for corporate expansion plans.
RBI Forecasts Corporate Sector Capex to Fuel Next Phase of Economic Growth
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