India’s infrastructure story has evolved from a focus on building quickly and at scale to asset performance and efficiency. Over the past decade, strong investment by the public sector has created a wide base of roads, railways, power systems, and urban infrastructure that now underpins economic growth. Central government capital expenditure has risen from around 2% of GDP in the late 2010s to over 3% in recent budgets, highlighting a steady commitment in providing impetus to infrastructure.
As India aims for long-term growth of 6–7% while keeping inflation in check, infrastructure is being seen less as a short-term stimulus and more as a way to lower costs and improve the supply side of the economy.
More value out of every rupee of capex
Post COVID, the government has regularly reinforced this emphasis through successive budgetary announcements, giving markets greater predictability and private investors more confidence. Government capital spending increased on average by more than 25% every year from FY20 to FY25, supporting construction activity, employment, and a wide range of allied industries.
The question now is how to derive more value out of every rupee of capex. Developing infrastructure that would reduce travel times, improve the reliability of utilities, and ease urban congestion can significantly reduce overall costs across the economy. In this sense, a comprehensive, well thought out infrastructure investment strategy would ensure the objective of strong growth alongside low and stable inflation.
A big part of this next phase is a stronger focus on managing what we have already built. India has created an impressive base of assets over the last decade. Take highways, for instance—we now have more than 1.4 lakh km of national highways, placing us among the top three countries globally.
Targeted investments that ease bottlenecks, improve safety, and add capacity often deliver strong economic returns without putting undue pressure on public finances. Simple interventions such as selectively widening busy corridors or modernising major rail terminals can make a noticeable difference to freight efficiency and passenger experience. Such measures are expected to help turn targeted capital expenditure into productivity gains.
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PPPs for productivity gains
Public–private partnerships are going to be crucial in this shift. PPPs provide a useful way of bringing in private capital, technology, and operational expertise, while keeping infrastructure aligned with public needs. India already has substantial experience with PPPs, especially in sectors like roads, airports, and ports, where the industry contributes around 20–25% of total infrastructure investment.
In addition to funding new projects, PPPs can also support better asset management across the entire lifecycle, freeing up the government to focus more on service quality and outcomes rather than just asset creation. Asset monetisation is closely tied to this evolving PPP landscape. As our infrastructure base matures, monetising operational assets has become an effective way to recycle capital into new projects. So far, these initiatives have helped unlock more than ₹4 lakh crore across highways, power transmission, airports, and other sectors.
How National Monetisation Pipeline 2.0 can broaden investor base
In this context, the proposed National Monetisation Pipeline 2.0 assumes particular importance. By offering a clear, multi-year view of assets and consistent policy signals, NMP 2.0 can help embed monetisation as a part of public capital management rather than a one-off exercise.
We also expect NMP 2.0 to help broaden and deepen the investor base, especially among long-term domestic and global institutions such as pension and insurance funds. The pipeline would showcase India’s long term vision in asset monetization, helping these institutions plan a long term investment strategy for the country.
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Mechanisms like Toll-Operate-Transfer and Infrastructure Investment Trusts have already shown how public assets can attract private capital without compromising long-term public interest. Emerging structures such as Public InvITs are expected to take this further by allowing retail investors to participate directly in India’s infrastructure story.
Taken together, India’s infrastructure agenda is moving toward a more balanced model. The emphasis is shifting from sheer expansion to productivity, from public funding alone to partnerships, and from one-time asset creation to managing value across the asset lifecycle. With policy continuity and gradual strengthening of execution and financing frameworks, infrastructure can support high growth and low inflation in the years ahead.
The writer is Director, Deloitte India
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