India needs to make land acquisition easier for industrial and infrastructure projects to attract higher domestic and foreign investments, NITI Aayog Vice Chairman Ashok Kumar Lahiri said while addressing the NCAER India Policy Forum 2026. 
Lahiri said India has made considerable progress in improving the ease of doing business over the past several years, but further reforms are still required, particularly at the grassroots level. He noted that structural issues continue to slow investment, with inefficiencies in factor markets, especially land and capital, remaining among the biggest challenges. 
According to Lahiri, acquiring land continues to be difficult not only for private industrial projects but also for government-backed infrastructure developments because of multiple hurdles, including legal disputes and procedural delays. He indicated that resolving these issues would help create a more favourable investment environment. 
Speaking on investment trends, Lahiri said foreign savings have supported India's economic growth, although the scale has remained much lower than the inflows witnessed by countries such as China and Singapore during their high-growth phases. He added that domestic savings continue to be the primary source of investment funding in any economy. 
He further said that investment and economic growth could be constrained if domestic savings remain inadequate. While acknowledging the reforms undertaken to improve the business environment, he maintained that additional efforts are needed to remove bottlenecks that continue to affect investment decisions. 
Referring to research conducted by the National Council of Applied Economic Research (NCAER), Lahiri said public investment in India has evolved over time. Unlike the period before the 1980s, when government spending often displaced private investment, public investment has now become complementary to private capital expenditure. He said this indicates that well-planned infrastructure spending can encourage greater private sector investment rather than limiting it. 
Lahiri also stressed that both domestic and foreign investors naturally seek profitable opportunities. He said India should focus on becoming one of the most attractive destinations for businesses by reducing risks and removing obstacles that could affect the country's long-term development journey towards the Viksit Bharat 2047 vision. 
India liberalised its foreign direct investment (FDI) regime in the 1990s, leading to a steady rise in capital inflows. Annual FDI increased from an average of around USD 3 billion to USD 7 billion during the early 2000s to about USD 43 billion in 2008, before crossing USD 50 billion in 2019. 
Recent government data also points to sustained investor interest. Gross FDI remained strong at around USD 95 billion during FY 2025-26, supported by India's growth outlook. However, net FDI inflows remained relatively subdued because of higher profit repatriation by foreign companies and increased outbound investments by Indian firms. At the same time, net FDI has started showing signs of recovery, with inflows rising to USD 7.4 billion in April 2026 compared with USD 1.6 billion during the corresponding month a year earlier. 
Speaking about India's long-term growth ambitions, Lahiri said that one estimate suggests India's per capita income would need to reach around USD 18,000 to USD 20,000 by 2047, after accounting for inflation, for the country to achieve developed nation status. With the estimated per capita income standing at USD 2,813 in 2026, he said the country would require an average annual nominal growth rate of about 9.25% over the next 21 years, resulting in income increasing by around 6.4 times. 
He cited the experiences of countries such as China, South Korea, Singapore and Japan to underline that such growth is achievable if supported by sustained economic reforms, investment and productivity improvements. 
Lahiri also pointed to government initiatives aimed at strengthening entrepreneurship, innovation and manufacturing. These include the Production-Linked Incentive (PLI) scheme, introduced in 2020, and the Atal Innovation Mission (AIM), launched in 2016, which are intended to encourage investment, innovation and industrial growth across sectors. 
Source PTI