While India’s capital expenditure has surged more than fourfold to over Rs 12 lakh crore over the last 7-8 years, the financing required for its infrastructure is beyond the capacity of government budgets, said Chief Economic Adviser Anantha Nageswaran on Monday.
Addressing the CII Tamil Nadu Infrastructure Summit 2026 on Monday, Nageswaran said the effective figure rises to nearly Rs 17 lakh crore when grants that create assets in states are included. “It has raised the capital expenditure from around Rs 2.5 lakh crore to over Rs 12 lakh crore for the current budget and more than a fourfold increase,” he said.
Nageswaran noted that the spending has supported the development of roads, railways, ports, power lines and digital infrastructure across the country. However, he stressed that the scale of infrastructure financing required in India cannot be met by government budgets alone. “The financing required for the infrastructure in India is far beyond what any government budget can carry,” he said.
“The public purse opened the innings but it cannot bat all day. The rest must come from private capital and not just any capital but patient capital,” Nageswaran said, referring to capital that is willing to earn steady returns over a period of 20-30 years. He said the government's spending on infrastructure has helped create assets and support economic capacity, but private investment will be crucial to meet the country's future infrastructure requirements.
Nageswaran also highlighted the Infrastructure Risk Guarantee Fund announced in this year’s Budget, saying it is intended to provide greater confidence to private developers. “This year’s budget took a step in that direction with the Infrastructure Risk Guarantee Fund meant to give private developers more confidence,” he said. However, he cautioned that guarantees alone would not be sufficient to attract patient capital. “Patient capital does not arrive because we ask nicely or because we insure it against our own unpredictability,” he noted.
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