Centre Targets ₹1 Trillion Highway Projects for Private Sector by FY27

India is making a decisive push to bring private capital back into highway construction, nearly a decade after investor interest weakened due to revenue uncertainties and procedural delays. The Centre is preparing a revised framework designed to reduce risk exposure for developers and create a more predictable investment environment.

Under the proposed roadmap, projects worth ₹1 trillion are expected to be awarded to private players by FY27. The move is part of a broader strategy to ensure that private investment contributes up to 25 percent of total highway development in the coming years. Currently, private participation remains in low single digits, with the government bearing the bulk of infrastructure spending.

To restore confidence, new norms are likely to include revenue protection mechanisms and the creation of an Infrastructure Risk Guarantee Fund. These measures aim to shield developers from traffic volatility and policy uncertainties that previously affected toll based projects. The framework is also expected to allow global investment funds to bid directly for projects, aligning India with international infrastructure financing practices.

The renewed push comes alongside a substantial rise in public infrastructure spending. In the latest Union Budget, the government allocated ₹12.2 trillion for infrastructure, with ₹3.1 trillion earmarked for roads and bridges. However, officials believe long term sustainability will depend on reviving private participation.

The highway sector earlier attracted significant interest under the Build Operate Transfer model, but shifting traffic projections and approval bottlenecks led to a decline in investor appetite. By addressing these concerns, policymakers aim to modernise the network, reduce logistics costs and strengthen India’s competitiveness.

With plans to expand the high speed road network fivefold within a decade, the government’s latest initiative signals a calibrated effort to balance public funding with renewed private sector confidence.