Budget 2026: ₹200 Crore Scheme for CIE

CIE Scheme to strengthen local manufacturing

Finance Minister Nirmala Sitharaman announced the Scheme for Enhancement of Construction and Infrastructure Equipment (CIE) in the Union Budget 2026–27, allocating ₹200 crore for 2026–27. The initiative aims to expand domestic manufacturing of high-value and technologically advanced construction machinery, covering equipment from residential lifts and fire-fighting systems to tunnel-boring machines for metro projects and high-altitude road construction.

Reducing import dependence

The CIE Scheme is designed to cut reliance on imported machinery, a long-standing challenge in India’s infrastructure development sector. Tunnel-boring machines and other specialized equipment, which are critical for metro and road projects, have largely been imported. The new scheme addresses this gap by promoting local production and enhancing India’s self-reliance in high-value construction equipment.

Hi-Tech Tool Rooms to support production

As part of the scheme, Central Public Sector Enterprises (CPSEs) will establish Hi-Tech Tool Rooms at two strategic locations. These digitally enabled, automated workshops will function as service bureaus where precision components can be designed, tested, and manufactured locally at scale. The move is expected to reduce costs compared to overseas sourcing while maintaining high-quality standards.

Meeting growing infrastructure demand

The announcement comes at a time when public capital expenditure is set at ₹12.2 lakh crore for FY2026–27, driving higher demand for heavy construction and infrastructure equipment. The tool room model mirrors advanced manufacturing practices used in the automotive sector, including just-in-time production and precision engineering, ensuring efficiency and quality in domestic machinery production.

Industry impact and outlook

Industry experts view the CIE Scheme as a strategic step to bridge domestic capacity gaps in high-value construction machinery. By enabling local manufacturing of tunnel-boring equipment, lifts, and specialized road construction tools, the initiative is expected to boost industrial competitiveness, reduce import costs, and support India’s infrastructure growth trajectory.

With the launch of the CIE Scheme, Budget 2026-27 reinforces India’s commitment to self-reliance, technological advancement, and sustainable infrastructure development, marking a critical step for the construction and industrial equipment sector.