India's Capital Expenditure Increase

India's Finance Minister, Nirmala Sitharaman, announced the Union Budget 2026-27, proposing a significant increase in capital expenditure to Rs 12.2 lakh crore for the coming financial year, an approximate 9% rise. This move aims to sustain momentum in infrastructure development and support economic growth. The budget also emphasizes continued focus on urban infrastructure, particularly in Tier-2 and Tier-3 cities. To encourage private participation in infrastructure projects, Nirmala Sitharaman proposed the establishment of an infrastructure risk guarantee fund. This fund will offer partial credit guarantees to lenders, reducing risk perception and facilitating financing for private developers. The government highlighted the substantial growth in public capital spending over the past decade and its commitment to infrastructure-led growth, supported by instruments like Business Trust in India (InvITs), Real estate investment trust (REITs), National Investment and Infrastructure Fund (NIIF), and India — National Bank for Financing Infrastructure and Development (NaBFID).