(Picture only for representational purposes): This photo taken with a drone shows the Bengaluru-Mysuru expressway, in Ramanagar district, Karnataka. | Photo Credit: -

The Union Budget for 2026-27 has significantly increased the allocation for public capital expenditure - by about 9 per cent - to ₹12.2 lakh crore, signalling the government’s continued focus on driving economic growth through infrastructure development.

A large portion of the capital outlay is directed towards enhancing the country’s transport network. The budget documents reveal a higher provision for the development of National Highways, expressways, and projects aimed at improving road connectivity in critical areas. The Ministry of Road Transport and Highways has been allocated a capital outlay of ₹2.94 lakh crore.

Indian Railways also receives a major financial push, with a capital outlay of ₹277,830 crore. According to the Expenditure Profile, these funds are intended for schemes financed from the National Investment Fund, doubling of railway tracks, and construction of new lines. The Budget Speech further outlines plans to develop seven new High-Speed Rail corridors to act as “growth connectors” between major cities. Additionally, the government will operationalise 20 new National Waterways over the next five years and launch a Coastal Cargo Promotion Scheme to increase the share of waterway transport.

Digital connectivity is another key area of focus. The Budget includes a higher provision for the creation and augmentation of telecom infrastructure through the Universal Service Obligation Fund, a capital infusion in BSNL, and funding for the Bharat Net project. The capital outlay for the Department of Telecommunications is set at about ₹47,274 crore.

The government also proposes the establishment of an Infrastructure Risk Guarantee Fund. This initiative is designed to provide partial credit guarantees to lenders, thereby strengthening the confidence of private developers involved in infrastructure projects. The sustained investment in infrastructure is presented as a core strategy to enhance national productivity and competitiveness

(This article was generated using artificial intelligence and reviewed by a journalist.)

Published on February 1, 2026