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Union Budge: Infra-Led Urban Shift

2026-02-02

The Union Budget FY27 reinforces infrastructure-led urbanisation as the backbone of India’s real estate and housing growth. Higher public capital expenditure, City Economic Regions, risk-mitigation mechanisms and REIT-led asset monetisation are being widely viewed as long-term enablers, even as the industry continues to seek sharper supply-side reforms and affordability-focused measures. Here are a few industry insights:

Dr Niranjan Hiranandani, Chairman, NAREDCO & Hiranandani Group

“The Union Budget 2026-27 is growth-oriented and stability-focused, supporting consumption and aiming to sustain the real estate sector’s momentum through infrastructure development and structural reforms. The proposal to set up the Infrastructure Risk Guarantee Fund delivers a sigh of relief to private developers… Enhanced connectivity and sustained capex will unlock significant demand in Tier-II and emerging cities.”

Ashish Puravankara, MD, Puravankara

“The budget strengthens the case for infrastructure led urban expansion, particularly around large magnet cities… Improved regional connectivity is enabling Tier-1 and Tier-2 cities attached to these metros to grow horizontally… This shift also addresses one of the sector’s core challenges—affordability.”

Pradeep Aggarwal, Founder & Chairman, Signature Global (India) Ltd.

“The government’s decision to raise public capital expenditure to ₹12.2 lakh crore in FY27 will play a critical role in accelerating project execution and crowding in private investment. Urban development receives a sustained boost with an allocation of ₹5,000 crore per year for five years for City Economic Regions.”

Ashwin Sheth, Chairman, Ashwin Sheth Group

“The Union Budget 2026–27 sets a strong tone for India’s urban transformation. The government’s continued emphasis on large public infrastructure, especially high-speed mobility networks and multimodal connectivity will reshape how cities expand.”

Mohit Goel, Managing Director, Omaxe Ltd.

“The Union Budget 2026 reinforces India’s growth momentum through a strong and sustained commitment to infrastructure and urban development, with public capital expenditure rising to Rs. 12.2 lakh crore in FY27… These markets are attracting not only local homebuyers but also growing interest from investors across India and abroad.”

Nitesh Kumar, MD & CEO, Emami Realty

“The proposal to establish dedicated Real Estate Investment Trusts (REITs) for recycling significant real estate assets held by Central Public Sector Enterprises is a game-changer, unlocking underutilised land and fostering greater investment in the sector. Additionally, the Infrastructure Risk Guarantee Fund will provide much-needed credit guarantees.”

Rajesh Damani, Founder & Managing Director, Jamshri Realty Ltd.

“We particularly welcome the movement toward refining the ‘Affordable Housing’ framework… However, the true legacy of this Budget lies in its push for sustainable real estate.”

Akshay Mittal, Promoter, Mittal Builders

“The Infrastructure Risk Guarantee Fund will also help developers to mitigate construction-phase risks, enabling faster project execution and reduced costs… However, there remains scope for fiscal rationalisation that could directly impact end-user affordability.”

Ramesh Nair, MD & CEO, Mindspace Business Parks REIT

“Dedicated REIT structures for CPSE asset monetisation strengthen the pipeline for long-term institutional capital across real estate and infrastructure… The push to develop City Economic Regions expands the addressable opportunity for organised commercial real estate.”

Sunil Nair, CEO, Ramky Infrastructure Ltd.

“By offering partial credit guarantees to lenders, the Infrastructure Risk Guarantee Fund will not only ease financing bottlenecks but also embolden private players to invest in new, large-scale projects with greater assurance.”

Utkarsh Kawatra, CEO & Co-founder, myHQ by ANAROCK

“While the budget does not address specific industry demands such as GST relief or ITC reforms, the focus on higher infrastructure capex, development of new logistics corridors, and investment in Tier-2 cities will indirectly create strong tailwinds for urban growth and ancillary commercial demand.”

Rakesh Reddy, Director, Aparna Constructions

“The Union Budget for FY27 reinforces continuity and confidence in India’s infrastructure and construction story… This consistency in infrastructure spending strengthens the foundation for both public projects and private sector development.”

Vikram Goel, Chief Business Officer – Industrial, Mahindra Lifespaces

“The continued focus on freight corridors, high-speed connectivity and the development of city economic regions will strengthen industrial competitiveness, logistics efficiency and regional growth.”

Navin Kumar, Managing Director, Navin’s

“The announcement of a ₹15,000-crore SWAMIH Fund to expedite the completion of nearly one lakh stalled housing units is expected to ease liquidity stress among developers and boost homebuyer confidence.”

Prakash Patel, Managing Director, Bhumi World

“By catalysing capital market participation through dedicated REITs to accelerate recycling and monetisation of under-utilised CPSE real estate assets, the government has unlocked a powerful mechanism to deepen liquidity.”

Aayush Madhusudan Agrawal, Founder & Director, Inspira Realty

“The Infrastructure Risk Guarantee Fund is a timely measure to improve access to construction finance and reduce execution risks, particularly for affordable and mid-segment housing projects.”

Amrita Gupta, Director, Manglam Group

“With a sustained focus on infrastructure creation, urban development and housing-led demand, it lays a strong foundation for long-term, planned growth across Tier II and Tier III cities.”

Aman Sharma, Founder & Managing Director, Aarize Group

“The focused allocation for Tier 2 markets recognises where India’s next major real estate opportunity will take shape… The introduction of the Infrastructure Risk Guarantee Fund is a timely intervention.”

Anil Godara, Founder & Managing Director, J Estates

“The proposed Infrastructure Risk Guarantee Fund is a pragmatic move that strengthens lender confidence during the construction phase.”

Harsh Jagwani, Managing Director, Notandas Realty

“The Income Tax Reforms will also benefit homebuyers, especially Non-Resident Indians (NRIs) and High-Net worth Individuals (HNIs).”

Sudhir Pai, CEO, Magicbricks

“Investments in regional connectivity—through high-speed rail corridors, freight networks and improved waterways—are expected to improve access to emerging cities and gradually deepen housing demand.”

Prashant Sharma, President, NAREDCO Maharashtra

“The significant increase in capital expenditure to ₹12.2 lakh crore, coupled with continued focus on Tier II and Tier III cities, will act as a powerful demand catalyst for real estate beyond metros.”

Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory

“The government’s intent to strengthen the corporate bond market, encourage REITs, and streamline foreign investment norms will improve transparency and capital access.”

Shilpin Tater, Managing Director, Superb Realty

“Dedicated CPSE REITs will significantly deepen India’s REIT market by introducing a sizeable pool of institutional-grade assets.”

Kamlesh Thakur, Co-Founder & Managing Director, Srishti Group

“The sharp rise in capital expenditure and focus on Tier II and Tier III cities will encourage planned development in emerging urban centres.”

Shraddha Kedia-Agarwal, Director, Transcon Developers

“Financial sector reforms, simplified tax compliance, and investor-friendly policies will improve liquidity and transparency across the sector.”

Gaurav Varma, Director, ORA Group

“The proposed high-speed rail corridors will act as powerful growth catalysts, opening up new corridors for residential, industrial, and mixed-use development.”

Dhruman Shah, Promoter, Ariha Group

“The push towards REITs, municipal bonds, and improved banking health will enhance funding avenues and reduce execution risks for developers.”

Nihar Jayesh Thakkar, Founder, The Mandate House Pvt. Ltd.

“The proposed Infrastructure Risk Guarantee Fund is a timely intervention that will de-risk infrastructure execution for private developers and lenders.”

Ramani Sastri, Chairman & MD, Sterling Developers

“The introduction of the Infrastructure Risk Guarantee Fund is a significant step that can ease financing challenges, strengthen lender confidence, and encourage greater private sector participation.”

Vikas Bhasin, Managing Director, Saya Group

“The emphasis on Dedicated Freight Corridors, port-led development, and infrastructure expansion in Tier II and Tier III cities is expected to provide a significant boost to the housing sector.”

Ashok Kapur, Chairman, Krishna Group and Krisumi Corporation

“Creation of the Infrastructure Risk Guarantee Fund will enhance lender confidence in the infrastructure sector, which is expected to encourage greater private sector participation in large-scale projects.”

Yash Garg, Director, M3M Noida

“Initiatives like the Infrastructure Risk Guarantee Fund and REIT-enabled asset monetisation are expected to enhance institutional capital flows and bolster developer confidence.”

Dr Vivek Garg, Founding Director, NVT Quality Lifestyle & Governing Board Member, CREDAI Bengaluru

“The concept of City Economic Regions with dedicated funding is particularly encouraging.”

Shrivallabh Goyal, CEO & Whole-Time Director, Model Economic Township Ltd. (Reliance MET City)

“With increased focus on urban housing, mobility, and city-level services, the government is laying the foundation for sustainable, liveable, and investment-ready cities.”

Across voices, the dominant theme is continuity—strong public capex, connectivity-led urbanisation, risk-mitigation and capital-market instruments shaping a more predictable and investable real estate ecosystem, while affordability and supply-side reforms remain key industry asks.

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