The Union Budget 2026-27 proposes increasing public capital expenditure to ₹12.2 lakh crore, continuing the government’s infrastructure expansion strategy and building on the rise from ₹2 lakh crore in FY2014-15.
The government stated it will continue focusing on infrastructure development in cities with populations exceeding 5 lakh, identifying Tier II and Tier III cities as emerging growth centres.
To strengthen investor confidence during construction phases, an Infrastructure Risk Guarantee Fund will be established to provide prudently calibrated partial credit guarantees to lenders.
The Budget also proposes accelerating recycling of significant real estate assets of Central Public Sector Enterprises through dedicated Real Estate Investment Trusts (REITs), positioning them as instruments for asset monetisation.
For freight movement, the government will establish new Dedicated Freight Corridors connecting Dankuni in the east to Surat in the west.
Additionally, ₹2 lakh crore support to states will be provided under the SASCI scheme to facilitate infrastructure creation.
The Budget further emphasises large-scale infrastructure enhancement through financing instruments such as Infrastructure Investment Trusts (InvITs) and institutions including NIIF and NABFID.
Together, these measures outline a financing-led infrastructure strategy combining higher public spending, credit guarantees, asset monetisation, and corridor development.
