Budget 2026-27 raises public capex to ₹12.2 lakh crore, sets up Infrastructure Risk Guarantee Fund
The Union Budget 2026-27, presented on 1 February 2026, raised public capital expenditure to ₹12.2 lakh crore and announced an Infrastructure Risk Guarantee Fund and CPSE REITs.
Summary
The Union Budget 2026-27, presented on 1 February 2026, raised public capital expenditure to ₹12.2 lakh crore for 2026-27, against about ₹11 lakh crore in RE 2025-26. An Infrastructure Risk Guarantee Fund will reassure private developers about risks during development and construction, and dedicated REITs will speed up recycling of CPSE real-estate assets. City Economic Regions will get ₹5,000 crore each over five years through a challenge mode with results-based financing. To encourage large municipal bonds, a ₹100 crore incentive is offered for a single issue above ₹1,000 crore.
Key facts
- Public capex 2026-27
- ₹12.2 lakh crore
- Capex RE 2025-26
- About ₹11 lakh crore
- New fund
- Infrastructure Risk Guarantee Fund
- Asset recycling
- Dedicated REITs for CPSE real estate
- City Economic Regions
- ₹5,000 crore per CER over 5 years
- Municipal bonds
- ₹100 crore incentive for a single issue above ₹1,000 crore
Practice MCQs 4 questions
What public capital expenditure did the Union Budget 2026-27 propose for 2026-27?
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Correct answer: D — ₹12.2 lakh crore
Public capex was raised to ₹12.2 lakh crore for 2026-27.
Which new fund did the Union Budget 2026-27 announce to reassure private developers about construction-phase risks?
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Correct answer: A — Infrastructure Risk Guarantee Fund
The Budget announced an Infrastructure Risk Guarantee Fund for risks during development and construction.
Under the Union Budget 2026-27, how much will each City Economic Region get for implementing its plan?
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Correct answer: B — ₹5,000 crore over 5 years
Each City Economic Region gets ₹5,000 crore over five years through a challenge mode with results-based financing.
Consider the following about the Union Budget 2026-27: 1. A ₹100 crore incentive is offered to a city for a single municipal bond issue of more than ₹1,000 crore. 2. Dedicated REITs are proposed to recycle real-estate assets of CPSEs. Which of the above is/are correct?
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Correct answer: C — Both 1 and 2
Both are correct, as listed in the Budget highlights.