Finance Minister Nirmala Sitharaman Acknowledges Concerns in Equity Markets

MUMBAI: Finance Minister Nirmala Sitharaman has indicated that the government is open to providing policy support for the equity market, acknowledging concerns from retail investors and market participants. This comes as the government aims to sustain economic growth above 7%. Sitharaman noted that while the tax structure has remained unchanged since FY24, the landscape has shifted with foreign institutional investors (FIIs) becoming net sellers, prompting louder calls for support.

Sitharaman emphasized the need for capital to maintain growth and acknowledged the demand for increased attention to equity markets, similar to the focus on developing the bond market in recent years. “I do not want to say more at this point but I recognise the voice,” she stated during an event organized by Financial Express.

The finance minister also highlighted a revival in private sector investment, attributing it to visible demand following the rollout of NextGen GST reforms in September 2025. While businesses are selective about their investment opportunities, she noted an increasing willingness to expand capacity in response to market demand. “Industry today has the confidence that I’m able to see demand in the market. I can invest and produce,” she said.

Sitharaman reiterated the government’s commitment to driving growth through public capital expenditure while maintaining fiscal discipline. She dismissed suggestions to loosen spending constraints or overlook fiscal deficits to stimulate investment. Public capital expenditure, according to her, has generated multiplier effects by creating productive assets and encouraging private investment. “Capital expenditure remains a core engine of our growth strategy,” she stated, affirming that the government will continue to support economic momentum through high capital spending.