The Union Government has sanctioned ₹3.6 lakh crore as part of its Scheme for Special Assistance to States for Capital Investment (SASCI). The scheme provides 50-year, interest-free loans to states, aimed at boosting capital expenditure and infrastructure development across the country.

Finance Minister Nirmala Sitharaman, in her announcement, highlighted that this financial support is designed to encourage states to increase their investments in areas such as roads, railways, power, housing, and health infrastructure. The long tenure and zero-interest feature make it easier for states to plan and execute big-ticket projects without adding to their debt burdens.

This initiative comes at a time when the government is focusing on accelerating growth through public investment. By helping states expand their capital spending, the Centre expects to stimulate demand, create jobs, and attract private investment. The move is also seen as critical to ensuring balanced regional development, since states are key drivers of on-ground execution.

The sanctioned loans will be released in tranches based on project readiness and adherence to guidelines. Priority will be given to projects that have high economic and social impact, such as green energy, digital infrastructure, and urban development.

Experts believe that this measure could have a multiplier effect on the economy. As capital investment increases, it will generate employment opportunities, support small and medium businesses, and improve India’s competitiveness in the global market. Moreover, the scheme reinforces the Centre’s commitment to cooperative federalism by giving states financial room to strengthen their developmental agenda.

Overall, the ₹3.6 lakh crore package is expected to be a game-changer in driving growth, improving infrastructure, and ensuring long-term economic sustainability across India.