Budget 2026-27: Experts Pitch Bigger Push For Roads, Faster Execution To Power Growth

New Delhi: Road infrastructure will be one of the most important focus areas for the Government of India in its Union Budget for financial year 2026-27. Economists and business leaders have called for increased capital investment and faster implementation of highway and transport projects, as they believe sustained investment in highway infrastructure will provide greater economic benefits, create jobs and support long-lasting economic growth.

Over the past 10 years, investment in highway infrastructure has resulted in improved transport connections throughout the country. Ahead of the budget, the Confederation of Indian Industry (CII) recommended that in order for India to reach its goal of becoming a US$ 5 trillion economy and achieving 'developed' status by 2047, the next phase of highway infrastructure development must focus on increasing scale, speed and efficiency.

Roads As A Growth Engine

Anil Chhikara, former Deputy Transport Commissioner of Delhi, emphasised that investment in mobility and road infrastructure delivers multi-dimensional benefits far beyond transport alone. "Sustained investment in mobility sectors will have numerous benefits," Chhikara told ETV Bharat. “Employment generation for building and execution of mobility support can exceed 100 persons per kilometre.”

He pointed to visible economic spillovers in cities and regions such as Ayodhya and Kumbh, where improved road connectivity has boosted tourism, trade and local industry. According to Chhikara, better planning and execution in road projects, like preventing material wastage and adopting just-in-time inventory systems, can save nearly 2 per cent of GDP.

“Connectivity will enhance and overall growth can improve by over 2 per cent of GDP. Road safety interventions alone can save up to 3 per cent of GDP losses,” he said, adding that transport sector investment can contribute over 7 per cent to overall economic growth, directly or indirectly, while delivering strong returns on investment.

The Multiplier Effect Of Highway Spending

Experts underline that road infrastructure offers one of the highest multiplier effects among public investments. Financial advisor Sharad Kohli said Budget 2026-27 is likely to continue the government’s strong push on highways and transport infrastructure precisely because of this impact. “One rupee spent on roads has nearly an eight times multiplier effect in terms of benefits,” he told ETV Bharat.

Kohli stressed that sustained investment in highways is essential to reduce India’s logistics costs, which remain significantly higher than global benchmarks. “Lower logistics costs are critical to attracting more investments and positioning India as a manufacturing hub,” he said, noting that a robust highway network is indispensable for supply chains, freight movement and industrial expansion.

Highlighting the scale of past investments, Kohli said the government has spent over Rs 100 lakh crore on infrastructure over the last decade, with annual capital expenditure touching around Rs 11–12 lakh crore in recent Budgets.

“I expect this infrastructure investment to continue. The focus on highways, transport networks and logistics will remain central because that is how you generate jobs, boost GDP and move towards Viksit Bharat 2047,” he added.

Speeding Up Execution: The Missing Link

While capital allocation has risen steadily, industry bodies caution that execution delays continue to undermine the full economic impact of road projects. The CII has identified land acquisition delays, lack of regulatory approvals, difficulties regarding access to funding sources, poor agency co-ordination etc., as just a few factors that frequently cause time and cost overruns for large infrastructure projects.

the Delhi-based industry advocacy group believes that the formation of a National Project Monitoring Authority with legal standing would be a good way to help alleviate these issues, starting with the timely identification of potential problems, in order to allow for early interventions.

CII suggests further investment in expanding the PM GatiShakti digital platform to include all public and public-private partnership (PPP) projects in excess of Rs 500 crore, allowing for real-time project performance evaluations, improved interdepartmental co-ordination and data driven intelligent decision-making, the likelihood of a greatly improved execution pace and quality for the completion of all road projects with improved metrics, should be considerable.

Providing Private Sector Support For Road Infrastructure

With the assumption that Budget 2026-27 will provide renewed momentum for the promotion and use of PPP schemes to develop road infrastructure, CII added that since its peak contribution to infrastructure investment — of around 30-35 per cent — there has been a dramatic decline, due to private sector reluctance to participate because of perceptions of risk, lack of finance availability, and disputes with public sector partners. It went on to suggest that the establishment of a National Infrastructure Guarantee Corporation would promote and encourage private participation in developing infrastructure in India.

The government-backed entity would provide credit enhancement and partial risk guarantees for PPP projects, particularly in transport and logistics, thereby lowering financing costs and improving investor confidence.

In addition, CII has called for launching a National Infrastructure Pipeline 2.0 for the 2026-32 period, with an enhanced investment target of Rs 150 lakh crore. Roads, highways and connectivity projects would be central to this next phase, aligned with PM GatiShakti for integrated planning and faster rollout.

Innovative Financing And Asset Monetisation

With traditional budgetary resources under pressure, experts expect greater reliance on innovative financing instruments to fund highway expansion and maintenance. CII has proposed issuing Viksit Bharat Infrastructure Bonds to mobilise long-term domestic savings for transport and logistics projects. These bonds, potentially tax-free and government-guaranteed, could attract both retail investors and the Indian diaspora.

Increased sovereign green bond issuance may be a viable means for funding sustainable road development projects, electric vehicle charging corridors, and climate-resilient infrastructure.

Monetisation of existing highway assets through Infrastructure Investment Trusts (InvITs) is another area likely to receive policy attention. Economists say recycling capital from mature road assets can free up resources for new expressways and rural connectivity projects without straining fiscal limits.

Roads, Manufacturing And The 2047 Vision

Experts broadly agree that roads and highways will remain at the centre of India’s infrastructure strategy as the country accelerates manufacturing, urbanisation and regional development. Better highways reduce transit time, improve supply chain reliability and make Indian manufacturing globally competitive.

“People and industry have already begun to feel the benefits of a robust highway system,” Kohli said. “That itself is a strong motivation for the government to maintain a decent and sustained outlay on this front.”

As Budget 2026-27 approaches, the consensus among experts is clear: Higher capital spending on roads, coupled with faster project execution and smarter financing, will not only strengthen connectivity but also act as a powerful catalyst for jobs, investment and long-term economic growth.

Also Read:

1. Union Budget 2026-27 Looks To Balance Manufacturing Push With Export Growth
2. Union Budget 2026-27: Experts Push for AI-First Strategy, Startup Boost and Deep-Tech Sovereignty
3. Union Budget 2026-27: Middle Class Hopes Rise, But Can Govt Afford Big Tax Relief?
4. Union Budget 2026: EV And Renewable Industries Call For Infrastructure, Finance Support