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Hi @Nishanth Chakkere,
Unfortunately, you cannot increase/decrease the width of left-hand navigation in SharePoint online modern experience. This is by default.
Personally, I completely agree with you, this is indeed a good addition to the current features of SharePoint if users can customize the width of left-hand navigation. Thank you for bringing things to our attention. We sincerely recommend you go to SharePoint Feedback community to provide your feedback: SharePoint · Community (microsoft.com) or upvote the similar requirements to yours like this Team site template - left navigation needs improvements. This is the best platform to let related team hear from you and make the products and services better for you and others.
Thanks.
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