Capital expenditure by the Central Public Sector Enterprises (CPSEs) and other state-run agencies like Indian Railways and the National Highways Authority of India reached Rs 5.8 lakh crore during April–December, achieving 73.6% of the full-year target, signalling steady progress in project execution and fund deployment.
This performance marks a modest improvement over the corresponding period last year, when spending stood at Rs 5.7 lakh crore, or 72.5% of the annual target in the year-ago period.
The overall achievement is 73.6% of the annual target in the first nine months of FY26 compared with 72.5% in the year-ago period of the relevant annual target.
The average monthly capex is in the order of Rs 64,000 crore, slightly below FY25’s full-year monthly average of around Rs 67,000 crore.
While the CPSE and other government agencies’ capex peaked in September with Rs 1.13 lakh crore, in FY25 strongest month was December with Rs 1.29 lakh crore
Meeting the full-year capex goal will require sustained acceleration in the remaining months of the current financial year.
Dominance of Railways and NHAI
Indian Railways and NHAI remain the key drivers of public capital spending, accounting for an estimated Rs 4.4 lakh crore, or 56% of the total FY26 target of Rs 7.85 lakh crore for CPSEs and other central agencies. Largely funded through the Union Budget, the two entities also constitute nearly 40% of the Centre’s overall capex estimate for the year.
Petroleum sector enterprises, which typically rely on internal resources and borrowings, are projected to invest around Rs 1.3 lakh crore in FY26. Sectors such as power, coal and steel are also expected to maintain strong investment activity as capacity expansion and modernisation efforts continue.
In FY25, state-run entities had invested Rs 8.1 lakh crore, exceeding the target by 3%. Given the progress so far, they are largely on track to meet the FY26 target, supporting the government’s broader public capex-led growth strategy.
Powering Core Industrial Demand
The robust public capex cycle is expected to generate strong multiplier effects across sectors, particularly boosting demand for steel, cement, machinery and construction services.
The government monitors the CPSEs and other organisations’ capex achievements (with annual CAPEX estimates of Rs 100 crore or more) and other Government organizations—namely the Railway Board, National Highways Authority of India, Delhi Metro Rail Corporation, and Damodar Valley Corporation.
The Centre’s budget capex recorded a healthy rise of 28% on year during April-November of FY26, amounting to about 59% of the annual target as against 49% in the year-ago period. Given the upfronting seen in H1FY26, the Centre’s capex needs to contract by about 14% on year during December-March FY26 to remain within the annual target of Rs 11.2 lakh crore.