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Cement manufacturers have welcomed the Union Budget 2026-27, stating that the sharp rise in public capital expenditure to INR 12.2 lakh crore reinforces infrastructure as the backbone of economic growth and improves long-term visibility for the sector. Industry representatives said the focus on Tier-II and Tier-III cities, City Economic Regions and major logistics reforms would accelerate construction activity across housing, transport and urban services. Measures such as new freight corridors, expansion of national waterways and high-speed rail corridors are expected to reduce logistics costs and support demand. The industry also highlighted the INR 20,000 crore allocation for carbon capture, utilisation and storage as a key step towards decarbonising emissions-intensive sectors such as cement.
Cement manufacturers have welcomed the Union Budget 2026-27, stating that the government's strong focus on infrastructure-led development creates positive prospects for the sector and reinforces infrastructure as a central driver of economic growth. Advertisement
Industry players said the increase in public capital expenditure to INR 12.2 lakh crore improves long-term demand visibility for cement, particularly as construction activity expands across housing, transport and urban services. The Cement Manufacturers' Association (CMA) said the emphasis on Tier-II and Tier-III cities, especially those with populations exceeding five lakh, along with the creation of City Economic Regions, would support broad-based cement consumption.
Under the Budget proposals, City Economic Regions are to receive an allocation of INR 5,000 crore each over five years. The industry said this would accelerate development across urban infrastructure, mobility networks and housing, strengthening regional growth beyond major metropolitan centres.
The cement sector also highlighted the significance of logistics and connectivity measures announced in the Budget. CMA said that the proposed dedicated freight corridors, the operationalisation of 20 additional national waterways over the next five years, and the launch of the Coastal Cargo Promotion Scheme would improve multimodal freight efficiency. The scheme aims to raise the modal share of waterways and coastal shipping from 6 per cent to 12 per cent by 2047. The industry added that these measures would help reduce logistics costs and improve the sector's overall carbon footprint.
In addition, the announcement of seven high-speed rail corridors as growth corridors is expected to further stimulate regional development and construction demand, particularly in emerging urban clusters.
CMA said the Budget reflected the government's intent to position infrastructure-led development as a structural pillar of India's growth strategy. The association also welcomed the INR 20,000 crore outlay for carbon capture, utilisation and storage (CCUS), noting that it could significantly alter the decarbonisation landscape for emissions-intensive industries such as cement by addressing technology and cost barriers.
Executives from leading cement companies said the Budget's focus on balanced regional development and clean technologies was encouraging. They noted that the proposed Infrastructure Risk Guarantee Fund could improve lender confidence and attract greater private investment into infrastructure projects. Industry leaders added that increased allocations for high-speed rail, Tier-II and Tier-III cities and religious tourism centres would drive sustained construction demand, while the emphasis on carbon capture and utilisation marked an important step towards enabling cleaner industrial growth.
Source - PTI
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