New Delhi: Signalling a decisive push to sustain India’s infrastructure momentum, Finance Minister Nirmala Sitharaman on Sunday proposed raising capital expenditure to ₹12.2 lakh crore, underlining the government’s intent to crowd in private investment while reducing project risks.
“To strengthen the confidence of private developers during the construction phase, we will set up an Infrastructure Risk Guarantee Fund to provide prudentially calibrated partial credit guarantees to lenders,” Sitharaman said, calling it a key step to de-risk large infrastructure projects.
In a major asset monetisation move, the Finance Minister announced faster recycling of prime real estate assets of Central Public Sector Companies (CPSCs) through dedicated REITs, describing them as a “successful and scalable instrument” for unlocking value.
Big Push for Green Cargo & Waterways
To promote environmentally sustainable cargo movement, Sitharaman announced plans to establish new Dedicated Freight Corridors linking Dankuni in the east to Surat in the west, and to operationalise 20 new National Waterways over the next five years.
The first phase will begin with National Waterway-5 in Odisha, connecting mineral-rich Talcher and Angul with industrial hubs like Kalinga Nagar and ports at Paradeep and Dhamra.
Training institutes will be developed as regional centres of excellence to generate skilled manpower for inland waterways, benefiting youth across the river stretches. A dedicated ship repair ecosystem for inland vessels will also come up at Varanasi and Patna.
To accelerate modal shift, Sitharaman announced a Coastal Cargo Promotion Scheme, aimed at doubling the share of inland waterways and coastal shipping from 6% to 12% by 2047.
Seaplanes, Tourism & Remote Connectivity
To improve last-mile connectivity and tourism access, incentives will be provided to indigenise seaplane manufacturing, along with a Viability Gap Funding (VGF) scheme to support seaplane operations.
₹20,000 Cr for Carbon Capture
Aligning with the CCUS roadmap launched in December 2025, Sitharaman proposed an outlay of ₹20,000 crore over five years to scale up carbon capture, utilisation and storage technologies across five sectors—power, steel, cement, refineries and chemicals.
City Economic Regions & Tier-2 Push
Calling cities India’s “engines of growth,” Sitharaman said the focus will now extend to tier-2, tier-3 cities and temple towns. The government will map City Economic Regions (CERs) based on local growth drivers.
An allocation of ₹5,000 crore per CER over five years will be provided through a challenge-based, reform-cum-result financing mechanism, she announced.
Seven High-Speed Rail Corridors
To promote green passenger transport, the government will develop seven high-speed rail corridors:
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Mumbai–Pune
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Pune–Hyderabad
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Hyderabad–Bengaluru
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Hyderabad–Chennai
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Chennai–Bengaluru
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Delhi–Varanasi
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Varanasi–Siliguri
Banking Reforms for Viksit Bharat
Highlighting the strength of India’s banking system, Sitharaman announced the setting up of a High-Level Committee on Banking for Viksit Bharat to align the sector with the next phase of growth while safeguarding stability, inclusion and consumer protection.
As a first step towards reforming public sector NBFCs, the government will restructure Power Finance Corporation (PFC) and Rural Electrification Corporation (REC) to improve scale and efficiency.
She also proposed a comprehensive review of FEMA Non-Debt Instruments Rules to create a more contemporary and user-friendly framework for foreign investment.
