No High-Five for Highway Fund in Budget 2025
The recent allocation of Rs 2.9 lakh crore for the road transport and highways ministry in the 2025-26 budget marks a mere 2.4% increase from the revised estimate of FY25. This is the lowest increment in the past decade, raising eyebrows among industry experts and stakeholders.
Sources indicate that the minimal rise is attributed to the lack of ongoing projects and the absence of new flagship highway development programs. To meet the expenditure target for FY25, the government has permitted the National Highways Authority of India (NHAI) to pre-pay around Rs 40,000 crore from its budgetary allocation.
Key Allocations and Trends
Of the total budget, Rs 1.9 lakh crore has been earmarked for NHAI, reflecting an increase of approximately Rs 20,000 crore from FY25. Notably, the government continues to fully fund NHAI without provisions for borrowing, emphasizing a strategy to reduce the authority’s debt burden. NHAI’s debt, which stood at Rs 3.3 lakh crore at the beginning of the current fiscal, has decreased to around Rs 2.8 lakh crore by the end of the third quarter of FY25.
Looking Ahead
While the budget may not bring the high-fives expected by many in the infrastructure sector, the emphasis on fiscal responsibility and debt reduction is clear. Stakeholders will be keenly watching for any new developments or approvals that could potentially revitalize highway projects in the coming fiscal years.
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