Union Budget 2026–27: Logistics Infrastructure India Updates Explained for Brands

The Union Budget 2026–27, presented on 1 February 2026 by Finance Minister Nirmala Sitharaman, marks a clear turning point in how India’s logistics and supply chain ecosystem is expected to evolve in the coming years.

Specifically, the Ministry of Road Transport & Highways (MoRTH) saw its allocation increase to around ₹3.10 lakh crore in the Union Budget 2026–27, up from ₹2.87 lakh crore last year. This higher spending underscores the government’s push to improve road infrastructure and freight movement, directly influencing pricing, margins, and delivery timelines for businesses.

As a result, the logistics sector has taken centre stage in the latest budget, especially around:

• Rising courier and last-mile delivery costs are impacting overall profitability.
• Higher customer expectations for faster deliveries, real-time tracking, and hassle-free returns.
• Growing export demand is pushing brands to manage customs, cross-border shipping, and compliance more efficiently.
• Supply-chain disruptions, including delays, capacity constraints, and fluctuating logistics costs.

Union Budget 2026–27 tackles these challenges by positioning logistics as a growth driver, focusing on better connectivity, faster clearances, and efficient supply chains to make logistics quicker, more reliable, and cost-effective for businesses.

So, without taking more of your time, let’s dive into the key logistics-related announcements in the Union Budget 2026–27 and understand how they will benefit businesses in the days ahead.

Read on!

Major Logistics Initiatives in Budget 2026–27

This year, the Union Budget 2026–27 positions logistics as a key growth lever for businesses, promoting multimodal transportation across roads, railways, and waterways. By offering flexible supply-chain options, faster cargo movement, digital customs integration, and modernized warehousing, the budget aims to reduce operational costs and delays for brands.

But how does this translate into real impact?

 

To understand, we need to look at the numbers and budget allocations for logistics and related infrastructure, as detailed below…

1. Capital Expenditure & Transport Allocation:

In FY 2026–27, total public capital expenditure is set to reach ₹12.2 lakh crore, the highest ever in an Indian budget.  Of this, transport and logistics receive ₹5.98 lakh crore, serving as a key driver of economic growth. 

Roads and highways alone are allocated ₹3.10 lakh crore, up from ₹2.87 lakh crore, thereby enhancing connectivity, accelerating freight corridors in India, and lowering logistics costs for businesses.

The budget also proposes a ₹75,000 crore investment in logistics and warehousing infrastructure to accelerate the development of multimodal logistics parks, modern warehouses, and advanced cold-chain facilities.

2. New Dedicated Freight Corridors: 

A new 2,052‑km East–West Dedicated Freight Corridor (DFC) will connect Dankuni (West Bengal) to Surat (Gujarat), passing through Odisha, Chhattisgarh, Madhya Pradesh, and Maharashtra, easing congestion and speeding up cargo movement. The Eastern and Western DFCs, spanning 2,843 km, are nearly complete, with 96.4% of the network commissioned.

3. Waterways & Coastal Shipping Expansion:

The government plans to develop 20 new National Waterways over the next five years, significantly expanding India’s coastal shipping network. The share of coastal freight is targeted to rise from 6% to 12% by 2047, promoting bulk cargo movement through ports and waterways. Transporting goods via waterways also offers a major cost advantage, at roughly ₹1.80 per tonne‑km compared with ₹3.78 by road, making it highly economical for large shipments.

4. High‑Speed Rail Corridors:

In the Union Budget 2026–27, the government announced seven new high‑speed rail corridors to boost connectivity between major economic and urban hubs, serving as growth connectors. These include Mumbai–Pune, Pune–Hyderabad, Hyderabad–Bengaluru, Hyderabad–Chennai, Chennai–Bengaluru, Delhi–Varanasi, and Varanasi–Siliguri.

Together, they span about 4,000 km, making them one of India’s most ambitious rail modernisation projects.

5. Container Manufacturing & Warehousing Reforms:

The budget launches a ₹ 10,000-crore Container Manufacturing Assistance Scheme to boost domestic production, targeting 1 million TEUs (Twenty-foot Equivalent Unit) annually, thereby reducing dependence on imports and stabilizing courier charges in India.

Warehousing reforms focus on digitization, integrated inventory management, and faster cargo clearance at ports and customs, improving supply-chain efficiency and lowering operational costs for businesses.

6. EV Battery Cost Relief for Fleets:

The Union Budget 2026–27 extends customs duty exemptions on key components used to manufacture lithium-ion batteries till March 2028. This helps reduce battery production costs, supports local manufacturing, and makes electric vehicles and logistics fleets more affordable over time.

8. Support for Small Transporters & MSMEs:

In Budget 2026, the government announced a ₹10,000 crore MSME Growth Fund to make credit more accessible and speed up payment settlements. It also infused an additional ₹2,000 crore into the Self-Reliance India Fund, strengthening financial support for MSMEs and small transporters across the logistics ecosystem.

How Budget 2026–27 Simplifies Customs and Export Logistics

Exporting sometimes caused unnecessary hassle for brands, particularly the ₹10 lakh courier export cap, which required splitting shipments or modifying product consignments. This obstacle is removed in Budget 2026–2027, which greatly increases the viability of exports and cross-border e-commerce for expanding brands.

To encourage exports, the budget introduces several exporter-friendly measures:

• Removal of the ₹10 lakh courier export value cap, enabling firms to transport more expensive goods via courier routes without splitting orders.
  
• Simplified return processing that lowers the expense and difficulty of D2C brands’ international returns
• Faster clearance for regulated goods such as cosmetics, electronics, and healthcare products through improved coordination and digital approvals

A Unified Customs Integrated System (CIS), a single digital platform for managing all customs procedures, is also announced in the budget. This includes:

• A single, centralized platform for digital customs
• AI-driven container scanning
• Decreased delays and fewer physical inspections

All things considered, Budget 2026–27 makes export logistics easier, quicker, and more brand-friendly, enabling Indian companies to expand internationally with fewer operational obstacles and more assurance.

How the Latest Budget Enhances Logistics and Transportation Efficiency?

As demand continues to grow, budget allocations are making the logistics sector more reliable, faster, and cost-effective than ever before. A key focus is the shift toward multimodal transportation, integrating road, rail, and waterways to create flexible and resilient supply chains.

Here’s how brands can benefit from these changes:

• Reduced dependency on a single transport mode: Diversifying across road, rail, and waterways lowers the risk of delays from congestion, fuel fluctuations, or road maintenance, ensuring goods move consistently.
  
• Better resilience during peak season: Multiple transport options allow brands to re-route shipments efficiently, avoiding bottlenecks during high-demand periods.
• Reduced transit time variability: Standardized transit times make delivery schedules more predictable, enabling businesses to plan inventory and shipments accurately.

• Improved forecasting and warehouse utilization: Real-time supply chain visibility helps forecast demand, optimize inventory, and increase warehouse efficiency.

• Lower safety stock requirements: With predictable deliveries, businesses can carry less safety stock, freeing up working capital and reducing storage costs for fast-moving goods.

In short, multimodal integration, faster cargo movement, and improved logistics infrastructure in India help brands cut costs, enhance operational efficiency, and deliver better customer experiences.

The Bottom Line

One of the most logistics-focused budgets India has seen in a long time is the Union Budget 2026–2027. It turns logistics from a cost center into a growth catalyst through investments in multimodal transportation, faster freight corridors, more waterways, modern warehousing, and easier export compliance. The logistics sector is modernizing operations as roads, trains, and digital customs systems evolve, creating an ideal opportunity for brands to simplify supply chains, reduce costs, and confidently grow both domestically and internationally.