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Budget 2026: Surat-Dankuni Freight Corridor & Rare Earth Hubs Announced

Finance Minister Nirmala Sitharaman announced a major dedicated freight corridor connecting Surat, Gujarat, to Dankuni, West Bengal, in the Union Budget for 2026-27. The budget also includes a plan to operationalize 20 new national waterways over five years to promote sustainable cargo movement. Significantly, the government proposed establishing dedicated "rare earth corridors" in the mineral-rich states of Tamil Nadu, Kerala, Odisha, and Andhra Pradesh. These initiatives aim to boost domestic logistics, strategic mineral processing, and reduce foreign dependence, particularly on China's near-monopoly in rare earths.

Key Points: Budget 2026: New Freight Corridor, Rare Earth Corridors

  • New Surat-Dankuni freight corridor
  • 20 new national waterways planned
  • Rare earth corridors in 4 states
  • Aims to reduce dependence on China
  • Projects in poll-bound states
2 min read

Union Budget: Govt proposes dedicated freight corridor between Gujarat's Surat and Dankuni in poll-bound Bengal

FM Nirmala Sitharaman announces Surat-Dankuni freight corridor and rare earth corridors in four states to boost logistics and strategic mineral capacity.

"We now propose to support the mineral-rich states... to establish dedicated rare earth corridors - Nirmala Sitharaman"

New Delhi, Feb 1

Presenting the Budget for 2026-27 on Sunday, Union Finance Minister Nirmala Sitharaman proposed a dedicated freight corridor connecting Surat in Gujarat and Dankuni in West Bengal.

The new freight corridor will establish a direct link between the two states, setting up new corridors for logistics and freight movement.

The Finance Minister also proposed to operationalise 20 new national waterways over the next five years, to promote an environmentally sustainable route for cargo movement.

The dedicated freight corridor between Gujarat and Bengal assumes significance as the Eastern state is slated to go to polls later this year. The corridor will traverse through multiple states across the Eastern and Western regions and connect the wealthier and industrial zones of Gujarat with Bengal, a relatively inferior and laggard state on various indexes of growth.

The proposed project seeks to project the Centre's focus on bringing big projects to Bengal and creating a congenial environment for fast-paced growth.

Besides this, the Finance Minister also announced "rare earth corridors" in four states.

She announced that dedicated corridors will be set up for minerals in four states -- Tamil Nadu, Kerala, Odisha and Andhra Pradesh.

Two of these states are headed for Assembly elections this year.

"The scheme for rare earth permanent magnets was launched in November 2025. We now propose to support the mineral-rich states of Odisha, Kerala, Andhra Pradesh and Tamil Nadu to establish dedicated rare earth corridors to promote mining, processing, research and manufacturing," said FM Sitharaman in her ninth Budget speech on Sunday.

Notably, rare earths are a group of elements widely used in building equipment of strategic importance and fighter jets.

Rare earths have lately emerged as 'key assets' in the geopolitical landscape, and nations are vying to have a large share.

Currently, China has a near-monopoly on rare earths, controlling 60 per cent of the world's mining and more than 90 per cent of processing capacity.

This announcement is a step towards building the country's own domestic capacity, thereby reducing dependence on foreign nations, including China.

- IANS

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Reader Comments

P
Priya S
Good initiative, but the timing before Bengal elections makes it feel political. Why announce it now? Infrastructure should be planned for long-term national benefit, not electoral cycles. Hope the project gets completed on time regardless of who wins.
R
Rohit P
The rare earth corridors are the real game-changer! Reducing dependence on China for critical minerals is a strategic masterstroke for national security. Kerala and TN getting this focus is excellent news for South India's industrial map.
M
Meera T
As someone from Kolkata, I welcome any investment in Bengal. We have been lagging for too long. If this corridor brings jobs and connects our ports better to Gujarat's industries, it's a win. But the article calling Bengal "inferior" is unnecessary and biased.
D
David E
The national waterways proposal is smart. Moving cargo by water is far more fuel-efficient than by road or rail. This, combined with the freight corridor, shows a holistic approach to logistics. Hope environmental assessments are done properly though.
S
Siddharth J
Finally some focus on the eastern part of the country. The Surat-Dankuni corridor should help balance regional development. My only request: please ensure local communities along the route are consulted and compensated fairly. Land acquisition issues can derail good projects.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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