Infrastructure Overhaul: Budget 2026 Unveils ₹2.7L Cr East-West Freight Corridor

Market snapshot: The Union Budget 2026-27 has signaled a massive shift in India's logistics landscape by proposing the new East-West Dedicated Freight Corridor (EW-DFC). Spanning 2,052 km from Dankuni in West Bengal to Surat in Gujarat, the project aims to integrate the eastern industrial heartlands with the western export hubs. With a record railway capital expenditure of ₹2.93 lakh crore, the government is doubling down on rail-led freight movement to achieve a structural reduction in logistics costs and insulate food prices from supply-chain inefficiencies.

Summary: Budget 2026 proposes a 2,052 km East-West Freight Corridor (Dankuni to Surat) at an estimated ₹2.7 lakh crore to reduce logistics costs and control food inflation.

Key Takeaways

• The corridor will connect West Bengal, Odisha, Chhattisgarh, Madhya Pradesh, Maharashtra, and Gujarat, linking with the Western DFC.
• Record railway allocation of ₹2.93 lakh crore for FY27, focusing on freight, safety (₹1.2L Cr), and high-speed rail.
• Projected logistics cost reduction aims to bring India's current 8-9% of GDP cost structure closer to global benchmarks, potentially lowering commodity prices by up to 0.5%.

SAHI Perspective

From an investment perspective, this announcement is a multi-year tailwind for railway infrastructure stocks and EPC players. By decongesting existing routes that currently handle over 400 trains daily, the EW-DFC will enhance the throughput of bulk commodities like coal and steel. For the FMCG and Agri sectors, the reduction in transit time—historically cut by 50% on operational DFCs—will serve as a natural hedge against food inflation.

Closing Insight

The East-West corridor is not just a rail project; it is a 2,000-km economic engine designed to make 'Make in India' competitive on a global scale by removing the logistics tax on manufacturing.

High Performance Trading with SAHI.