RBI: Corporate Growth in India to Be Driven by Supply Chain Strength, Cost Efficiency, and Innovation
New Delhi: The Reserve Bank of India (RBI), in its latest Bulletin, said that the future of corporate growth in India will be shaped by stronger supply chains, improved cost efficiency, and accelerated technological innovation.
The central bank emphasised that these factors will be essential in maintaining competitiveness and determining overall corporate performance in the coming years.
“Strengthening supply chains, improving cost efficiencies, and fostering technological innovations will play a key role in maintaining competitiveness and shaping overall corporate performance,” the RBI stated.
According to the report, the sustainability of corporate growth will depend on a mix of macroeconomic conditions, domestic demand, supportive policy measures, and global market trends. Continuous efforts to enhance productivity and innovation will further determine how effectively Indian companies adapt to evolving challenges.
The Bulletin observed that India’s private corporate sector has shown remarkable resilience and adaptability through multiple economic disruptions, including the COVID-19 pandemic.
During 2019–20, weak domestic activity and sluggish private consumption led to a decline in sales and profitability, which worsened amid the pandemic. However, the corporate sector made a strong recovery thereafter, driven by fiscal and monetary support, pent-up demand, and effective cost management.
Sales growth surged to 32.5% in 2021–22 before stabilising at 7.2% in 2024–25, signalling a transition from rapid recovery to a more sustainable growth phase.
The analysis also revealed that corporates have continued to deleverage their balance sheets, improving their capacity for new investments. Medium and small firms have strengthened their debt-servicing abilities, contributing to overall financial stability.
Operating profit margins have remained robust, with large companies consistently outperforming smaller peers.
With a solid financial base, enhanced efficiency, and adaptive strategies, the RBI noted, India’s corporate sector is well-positioned to seize future opportunities and drive sustained economic expansion.
