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BUDGET 2018-19: The biggest boost to infrastructure ever

Akhilesh K Prasad

In a major boost to infrastructure, in Budget 2018-19 the finance ministry has allocated a total capital outlay of Rs. 5.97 cores for FY 2018-19. This is a massive increment of about 20.8% over the previous year. The finance minister also emphasized in his budget speech that India needs about Rs. 50 lakh crore for Infrastructure development which the government intends to enhance through public investments. The salient features of Budget 2018-19 with respect to infrastructure development are as follows:

Aviation Infrastructure:

The government proposed to upgrade standards to accommodate 1 billion flights a year. 56 unserved airports and 31 unserved helipads will become operational very soon. For the coming financial year, a budget of Rs. 1,014.09 crore has been allocated to revive 50 airports and improve aviation in the north-east states under the flagship regional connectivity scheme UDAN. This allocation is 5 times the revised estimate of FY 2017-18. The finance ministry also allocated a sum of Rs 73.31 crore as grants-in-aid to Airports Authority of India as reimbursement of expenditure already done for the development of Pakyong airport in Sikkim, which borders China.

Railways Infrastructure:

Capital expenditure of Rs. 1.48 trillion was allocated to railways, to improve its carrying capacity in view of falling revenues, and travel experience. This includes track doubling, third and fourth line works of 18,000 km and 5,000 km of gauge conversion. Redevelopment of 600 major railway stations, setting up of escalators at stations with over 25,000 footfalls, CCTVs and Wi-Fi were also included herein.

Telecom Infrastructure:

Rs. 10,000 crore was allocated to set up 5 lakh Wi-Fi hotspots.

Urban Infrastructure:

Under AMRUT, state-level plans for providing water supply to households in 500 cities with a capital expenditure of Rs 77,640 crore have been approved. Capital outlay under PMAY (urban) has also been increased for the targeted construction of 37 lakh houses in FY 2018-19. With respect to the Smart Cities Mission (SCM), the finance minister said, while projects worth Rs. 2,350 had been completed and works of Rs. 20,852 were under progress, and the SCM would involve a capital outlay of Rs 2.04 lakh crore.

Rural Infrastructure:

Budget 2018-19 laid importance on rural infrastructure, through the development of roads, houses, sanitation, irrigation and water supply. The Budget has laid emphasis on the completion of ongoing high-priority irrigation projects and increased allocation under PMKSY-AIBP. Construction of 51 lakh rural households was announced to meet the target of the government’s flagship “Housing for all by 2022” project.


At Rs.1.21 trillion, the road budget for FY 2018-19 is the largest ever. For the Bharatmala (roads) project approved in FY 2017-2018 the government intends to raise an estimated Rs. 5.35 trillion equity from the market. NHAI was asked to consider innovative revenue models such as toll, operate and transfer (TOT) and Infrastructure Investment Funds to facilitate the same. The finance minister also stated that, while a total investment estimate for Bharatmala stood at Rs. 10 trillion, an additional Rs. 8 trillion would be required for the Sagarmala (ports) project.


While the budget has been widely criticised for laying too much focus on rural India and not having anything in it for the middle class, it is, in fact, the biggest thrust to infrastructure ever. Through this budget, the government has made a statement to the effect that India’s infrastructure needs to be developed in order to boost the Indian economy, and quite rightly so.

Construction QualityAn MBA by qualification, Akhilesh has dabbled into various businesses. He is a keen debater, data miner and analytically inclined. His blogs tend to present a fresh perspective on any given matter.

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