The Centre’s significant capital investments in infrastructure projects, including highways, railways, and power, alongside critical sectors like defence, are expected to boost India’s economic growth in FY 2025-26 and beyond, according to a report by Prabhudas Lilladher (PL). The government allocated ₹11.1 lakh infrastructure in the FY 2024-25 budget, with expectations of an even higher allocation in the upcoming.
The forthcoming budget is anticipated to focus on driving economic recovery by boosting middle-class spending, especially as inflation has eased. The report’s optimism is reinforced by industrial growth reaching a six-month high of 5.2% in November, up from 3.5% in October, according to the Ministry of Statistics.
India is set to witness a surge in infrastructure development in FY26, driven by increased government spending on major projects across transportation, energy, and urban development. According to a recent report, the central and state governments are expected to allocate substantial funds to boost economic growth, enhance connectivity, and create employment opportunities.
The government’s focus remains on large-scale infrastructure projects such as highways, railways, airports, and smart cities. The National Infrastructure Pipeline (NIP), with an investment target of ₹111 lakh crore by 2025, continues to be a key driver, accelerating projects in roads, metro rail, and renewable energy.
One of the critical areas of investment will be transportation. The Ministry of Road Transport and Highways plans to expand expressways and national highways, FY 2025-26 budget. These investments aim to stimulate demand and support long-term growth, the report highlights. aiming for faster logistics and reduced travel time.
Urban infrastructure will also see a boost, with increased allocations for metro Similarly, the Indian Railways is advancing its modernization plans, including high-speed rail corridors, station redevelopment, and electrification. projects, smart city initiatives, and housing schemes. Additionally, the government is likely to invest heavily in green energy, supporting solar and wind power projects to meet India’s.;
Experts believe that continued public investment will attract private sector participation, further accelerating growth. With robust government spending, FY26 is poised to be a transformative year for India’s infrastructure landscape, setting the stage for long-term economic expansion and global competitiveness.
The government’s focus remains on expanding the national highway network, with multiple expressways and corridor projects planned under the Bharatmala Pariyojana. Rail infrastructure is also receiving a significant, with dedicated freight corridors, metro expansions. The Indian Railways is expected to benefit from substantial budgetary allocations aimed at modernizing stations, electrifying tracks.
In addition to transport infrastructure, investments in smart cities, urban mobility, and energy projects will further strengthen India’s growth trajectory. The expansion of renewable energy infrastructure, including solar and wind power, aligns with the nation’s sustainability goals while enhancing energy security. The government is also.
According to experts, increased public spending on infrastructure will have a Similarly, the Indian Railways is advancing its modernization plans, including high-speed rail corridors, station redevelopment, and electrification. sustainability goals. multiplier effect on the economy, stimulating demand across sectors such as steel.
With infrastructure development at the core of India’s economic strategy, the , and increasing freight capacity. government’s enhanced spending in FY26 is set to improve living standards, create jobs, and strengthen India’s position as a global economic powerhouse. The sustained push in infrastructure is expected to drive long-term growth and make India a more competitive destination for global.
Investments prioritizing digital infrastructure and industrial corridors to attract foreign rise, further accelerating project execution investments and boost cement, and construction equipment. Private sector participation is also expected to manufacturing The upcoming budget is expected to prioritize capital expenditure, further strengthening momentum.
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