With the presentation of the Union Budget 2026–27 drawing closer, the infrastructure sector has urged the government to increase budgetary allocation and introduce policy measures to improve project execution and sustain growth. Industry stakeholders believe that infrastructure development will play a critical role in India’s ambition to become a developed economy by 2047.
Over the past decade, government capital expenditure has grown significantly, supporting large scale development in sectors such as highways, railways, airports, ports, and urban infrastructure. However, industry representatives say that despite higher spending, several major projects continue to face execution delays and rising costs. These challenges, they argue, reduce the overall impact of public investment.
The sector is seeking a 10 to 15 percent increase in infrastructure allocation in the upcoming budget. Industry leaders believe that higher funding will help strengthen urban infrastructure, expand transport networks, and support new public works projects across the country. Increased capital expenditure is also expected to boost employment and attract private investment into infrastructure development.
Another key demand from the industry is reform in procurement practices. Stakeholders have urged the government to move away from awarding contracts solely on the basis of the lowest bid. They believe that quality standards, technical capability, and execution capacity should be given greater importance during the bidding process. According to industry experts, projects awarded to firms without adequate technical expertise often face delays, affecting timelines and increasing costs.
Timely execution has emerged as a major concern for infrastructure companies. The sector has called for more consistent pre qualification norms and streamlined approval processes to ensure projects move forward without unnecessary interruptions. Faster clearances and better coordination between central and state agencies are also seen as essential to improve delivery timelines.
The infrastructure industry has also highlighted the need for greater focus on Tier 2 and Tier 3 cities. While metro cities continue to receive significant investment, stakeholders believe smaller cities and towns require more support to achieve balanced regional development. Improved urban infrastructure in these areas could ease pressure on major cities and promote economic growth across regions.
Industry representatives have noted that previous announcements related to urban infrastructure funds and large capital expenditure programmes have been encouraging. However, they stress that effective implementation and targeted spending are necessary to achieve desired outcomes, especially in smaller urban centres.
The sector believes that higher allocations, improved procurement policies, and faster project execution in the Union Budget 2026 could drive infrastructure led sustainable growth. These measures are seen as critical to strengthening India’s economic foundation and supporting long term development goals.
Finance Minister Nirmala Sitharaman is scheduled to present her ninth Union Budget on February 1, with expectations running high across key sectors of the economy.
