Sitharaman proposed raising public capital expenditure to Rs 12.2 lakh crore, signaling the government’s continued focus on infrastructure-led growth. Screengrab: ANI
Union Budget 2026 lays out big infra push with capex, waterways focus
Budget proposes Rs12.2 lakh crore capex, infra risk guarantee fund, new freight corridors and a major push for inland waterways and logistics
The Union Budget has outlined an ambitious infrastructure roadmap, with Union Finance Minister Nirmala Sitharaman announcing a series of measures aimed at expanding capacity, attracting private investment and strengthening multimodal connectivity.
Capex raised to Rs 12.2 lakh crore
Presenting the Budget, Sitharaman proposed raising public capital expenditure to Rs 12.2 lakh crore, signalling the government’s continued focus on infrastructure-led growth. She said the emphasis will increasingly shift towards cities with populations above 5 lakh, particularly Tier-2 and Tier-3 urban centres, to support balanced regional development and ease pressure on major metros.
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In addition, the government plans to introduce dedicated real estate investment trusts (REITs) to recycle assets of central public sector enterprises, unlocking capital for new investments.
A major thrust of the Budget is on logistics and transport connectivity. Sitharaman announced plans to develop new dedicated freight corridors linking Dankuni in eastern India with Surat in the west, aimed at improving freight efficiency and reducing logistics costs.
20 new national waterways planned
Inland waterways also featured prominently, with a proposal to operationalise 20 new national waterways over the next five years, beginning with Odisha.
As part of this push, the government will develop a ship-repair ecosystem in Varanasi and Patna, strengthening inland shipping infrastructure. Sitharaman also announced a coastal cargo scheme to raise the share of coastal shipping and support domestic manufacturing of seaplanes.
Infra financing reforms highlighted
Sitharaman, in her Budget speech said that during this past decade, the government has undertaken several initiatives for large-scale enhancement of public infrastructure, including through new financing instruments such as Infrastructure Investment Trusts (InVITs) and Real Estate Investment Trusts (REITs) and institutions like NIIF and NABFID.
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Noting that cities are India's engines of growth, innovation, and opportunities, she said the government will now focus on Tier-II and Tier-III cities, and even temple-towns, which need modern infrastructure and basic amenities.
City economic regions get funding boost
Sitharaman said this Budget aims to further amplify the potential of cities to deliver the economic power of agglomerations by mapping city economic regions (CER), based on their specific growth drivers.
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"An allocation of Rs 5,000 crore per CER over five years is proposed for implementing their plans through a challenge mode with a reform-cum-results based financing mechanism," she said.
Together, these measures are intended to create a more integrated, resilient and investment-friendly infrastructure ecosystem across the country.
(With agency inputs)