Infrastructure: Prioritizing Consistent Growth in Budget 2025-26
Overview

Overview
With the Indian economy flourishing, there are numerous investment opportunities in multitude of sectors. The growth potential is excellent, thanks to technological advancements in the dynamic industry, which are augmented by different legislative reforms. The Indian economy has so far been resilient to persistent downside threats. Despite the slight dip in expectation of growth at 6.5-7% in the fiscal year 2024-25 according to the Economic Survey 2023-24, there is a positive sentiment about global economic backdrop. Coming to infratruscture segment of the nation, it is believed that Finance Minister Nirmala Sitharaman is likely to increase capital expenditure (capex) in the infrastructure sector in the Union Budget 2025-26 in order to bolster and boost urban development. Sitharaman will deliver the budget for 2025 on February 1, 2025. According to Federation of Indian Chambers of Commerce & Industry (FICCI) regarding the upcoming budget, the focus of government in the last few years on capex has been contributing to support recovery and sustain the momentum of growth. During persistent headwinds from the global front, public capex, especially physical, social, and digital infrastructure, would be critically important for the maintenance of growth momentum.
In the previous Union Budget that is in 2024-25 maintained a strong commitment to balancing multiple objectives in order to achieve Viksit Bharat’s vision. Continuing and extending the reform program on the nine priorities established in the Union Budget 2024-25 will be critical to maintaining the economy’s resilience.

India’s Infrastructure
India’s landscape is fast changing as the Government of India spends extensively in infrastructure projects such as roads, railroads, and renewable energy. To stimulate domestic manufacturing and increasing demand for machinery and construction materials, the government has launched projects such as ‘Make in India’. The infrastructure sector was allocated ₹11.11 lakh crore in the Union Budget 2024, and is expected to increase to ₹18 lakh crore in the next Budget 2025. As a result of thse schemes, GDP figures are expected tom improve significantly at the same time boosting public-private partnerships.Other notable initiatives such Housing for All, National Infrastructure Pipeline (NIP), and PM Gati Shakti would support and aid in enhancement of the infrastructure sector in India.

Smart City Mission
Another major budget expectation for the infrastructure sector, would be Smart Cities Mission development and implementation. India’s urban development and overall landscape is bolstered by Smart Cities Mission. Launched in 2025, by PM Narendra Modi, the Smart City Mission aims at improving quality of life in 100 cities across in India by way of infrastructure, sustainable environment and effective essential services. Further, the solutions offered through this mission aim to promote economic growth, financial inclusion, sustainability in urban development, etc.

Mitu Mathur, Director of GPM Architects and Planners, told ETNOW.in that the 2019 budget will prioritize essential expenditures in India’s urban development, with a focus on safety, sustainability, and infrastructure. She stated that the primary focus should be on transit-oriented development, which has the potential to alleviate traffic congestion by up to 30% while increasing property prices near transit hubs by 20%. “This focus on TOD will contribute to more sustainable, connected cities with both environmental and economic benefits,” according to her.

Mathur added that the future budget must prioritize sustainable infrastructure as India’s urban population continues to grow. She emphasised that green initiatives could bring down energy consumption by up to 50% while at the same time, improved waste management could reduce 70% of urban waste going to landfills. Furthermore, in light of recent instances, women’s protection in metropolitan areas is projected to become a top focus. Beyond improved street lighting and monitoring, we anticipate financing for smart lighting systems that respond to pedestrian activity, as well as the creation of safe pathways with well-maintained paths and emergency stations,” she stated.

Goonmeet Singh Chauhan, Founding Partner of Design Forum International, anticipates that the 2025 budget would place a greater emphasis on blue-green infrastructure under the Smart Cities Development initiative. “Given the gravity of the AQI issue in most towns, a data-driven approach is required to create and improve urban green cover, tree biomass, and tree demography, as well as their relationship with habitation density. Ideas such as responsive green infrastructure, the integration of ‘city forests’ into urban fabrics, and the Federal Acquisition Regulation (FAR) of forest pockets must be adopted immediately. Expanding on ‘blue infrastructure,’ hydrological master plans for all future smart cities must be developed to capture the current nature of hydrological behavior, with a particular emphasis on drainage and aquifer studies” he emphsised.

Conclusion
India’s strong economic foundations and concentration on innovation and technology make it a prominent investment destination. The sectors mentioned above are at the heart of India’s growth story. Keeping a close eye on these industries and their potential will allow you to better capitalize on future chances.

The image added is for representation purposes only