Union Budget 2026-27: Capex Drive Outsmarts Other Measures

• The 2026-27 Union Budget prioritizes capital expenditure, increasing it from Rs. 11.2 lakh crore in FY2026 to Rs. 12.2 lakh crore in FY2027, despite fiscal prudence.
• Total budget capex for FY2026-27 (Rs. 12.2 lakh crore) nearly equals the Union Government’s total capital expenditure from 2004-05 to 2013-14.
• Defence receives the highest allocation at Rs. 7.85 lakh crore, with Rs. 2.19 lakh crore for capex, marking a 3.4x rise since 2014-15.
• Roads and Highways continue to receive significant funding (Rs. 3.10 lakh crore), accounting for 25% of total central government capex.
• Railways gain prominence with the announcement of a third Dedicated Freight Corridor and seven new high-speed rail corridors, totaling nearly 4,000 km and an estimated investment of Rs. 16 lakh crore.

Why It Matters: The 2026-27 Union Budget's core focus is a massive, sustained push on capital expenditure, particularly in infrastructure and defence.