India’s roads sector is entering a decisive phase. After a decade defined by rapid kilometre expansion and record-breaking award numbers, the next cycle will be judged less by scale and more by substance. As 2026 unfolds, the central question confronting the industry is not whether road investments will continue, but where they will originate – from the Centre or the states – and how that shift will reshape opportunities and risks for contractors, consultants, vendors and financiers. Lt Gen Rajeev Chaudhry, Former DG, Border Roads Organisation (BRO), sees the coming year as a structural turning point rather than a pause. “2026 is not a slowdown year; it is a transition year. We are moving from kilometre-built to value-built.” The emphasis, he explains, is shifting decisively towards quality, safety, asset life and risk allocation, with capital discipline becoming the defining filter. “Risk and capital will decide which projects move forward and which do not.”Rebalancing rolesFraming the discussion as ‘State versus Centre’ risks oversimplifying a more nuanced reality. Central agencies have shouldered the bulk of highway development over the past decade, expanding the National Highway network from about 96,000 km to over 146,000 km. In doing so, they have already addressed many of the easier corridors. What remains are projects that are structurally heavier, more complex and more capital-intensive.“Kilometres may reduce, but the cost per kilometre will increase,” says Lt Gen Chaudhry. “The Centre will increasingly focus on complex corridors – strategic roads, border connectivity, access-controlled expressways, tunnels, elevated sections and urban interfaces.” Budgetary allocations, he notes, remain strong, but the nature of spending is changing. “We are standing at an inflection point where value matters more than volume.”At the same time, states are emerging as the principal volume drivers. Improved fiscal capacity, tax devolution and access to multilateral funding have emboldened state governments to accelerate expressways, urban roads and regional connectivity. “States are getting richer and more confident,” Lt Gen Chaudhry observes. “Infrastructure now delivers visible political and economic returns, and states are investing accordingly.”RK Pandey, former Member, National Highway Authority of India (NHAI), and ADG, Ministry of Road Transport and Highways (MoRTH), argues that the debate should not be adversarial at all. “Rather than saying State versus Centre, I would say State and Centre,” he says. “A National Highway cannot deliver its full value unless it is supported by strong feeder networks. Connectivity has to work as an integrated system.”Centre’s next phase: Depth and deliveryFor central agencies, the next phase is likely to be defined by fewer projects, but of far greater complexity. Strategic corridors in border areas, economic corridors linking ports and logistics hubs, ring roads, urban decongestion projects and elevated highways are expected to dominate the pipeline.“The easier National Highways are largely done,” says Lt Gen Chaudhry. “What lies ahead are projects with higher execution risk, higher structural content and higher land acquisition costs – but also far greater strategic and economic value.”Pandey highlights a parallel shift in institutional priorities. “We are no longer chasing awards; we are focusing on completion,” he says. This change has translated into stricter preconditions before projects are awarded, particularly with respect to land possession and design readiness. “Unless land is in possession, projects will not be awarded. It slows the award cycle, but it significantly reduces disputes and time overruns later.”For contractors and consultants, this signals a tougher operating environment. Qualification requirements are tightening, technical capability is becoming non-negotiable, and experience in tunnels, bridges, urban works and complex structures will increasingly determine who secures central projects.While the Centre builds depth, states are positioning themselves  as engines of volume and regional growth. Expressways, industrial corridors, urban bypasses and district connectivity projects are becoming central to state-level economic strategies.Uttar Pradesh offers a clear illustration. Srihari Pratap Shahi, Additional Chief Executive Officer, Uttar Pradesh Expressways Industrial Development Authority (UPEIDA), says road development in the state is inseparable from industrialisation. “Our expressways are not just transport corridors; they are economic corridors,” he explains. “Along each expressway, we are planning industrial pockets across districts to unlock investment and employment.”Equally important, he emphasises, is alignment with national planning. “We coordinate closely with NHAI to avoid duplication,” Shahi says. “State and central planning must be consistent; parallel roads competing for the same traffic only weaken project viability.” This coordination, he believes, is critical for building confidence among developers and financiers.Contract models: EPC dominance, BOT reengineeredEPC is expected to remain the dominant delivery model in the near term, particularly for high-risk and complex projects. “EPC will continue to be the mainstay,” says Lt Gen Chaudhry. “It provides cash flow certainty and is better suited to projects where risks cannot be efficiently transferred.” His experience at BRO reinforces this view. “PPP models do not work for strategic roads in extreme terrain. Private players are understandably cautious in such environments.”However, Pandey believes BOT is not a closed chapter. “The problem is not BOT itself but how risk is allocated,” he says. Revised concession documents and improved risk-sharing mechanisms, he explains, are being developed to revive private interest. “Traffic risk mitigation clauses are being strengthened. BOT will reemerge as a viable option, particularly for brownfield assets and monetisable corridors.”From an investor-operator perspective, operational consistency matters more than ownership. Ankit Jain, Chief Financial Officer, Cube Highways, which operates a portfolio dominated by National Highway assets, sees little difference in day-to-day operations. “From an operations standpoint, there is no major difference between state roads and NHAI roads,” he says. “Both are increasingly focused on safety, technology and maintenance.”Where divergence exists, he notes, is in financial capability. “State bodies often lack dedicated PPP and finance teams,” says Jain. “Approvals for refinancing or ownership changes can be challenging.” Still, he cautions against competitive overlap. “There is no benefit in the Centre and states competing. Planning has to be complementary.”Materials innovation is equally critical. Dr V Ramachandra, Principal Advisor - Technical Services, UltraTech Cement, and President, Indian Concrete Institute, highlights concrete’s role in delivering durable and sustainable roads. “Concrete is one of the most sustainable construction materials,” he says. “Its lifecycle performance makes it ideal for highways and urban roads alike.”He points to white topping, short-panel concrete pavements and precast road systems as examples of how design innovation can reduce thickness, material consumption and maintenance costs. “By reducing panel sizes, flexural stresses reduce significantly, allowing thinner pavements without compromising performance,” he explains.Sustainability, Ramachandra adds, will increasingly influence procurement. “Low-clinker cements, optimised mix designs and alternative aggregates can reduce carbon footprint by 40 to 45 per cent,” he says. “Carbon metrics will soon sit alongside cost metrics in project evaluation.”Lt Gen Chaudhry reinforces this with field experience from BRO projects in Arunachal Pradesh. “We implemented a fully precast road system – we called it ‘road  on wheels’,” he says. “It required less manpower, avoided hot-mix plants, reduced the carbon footprint and was cheaper than conventional construction.”Beyond engineering and contracts, confidence remains the sector’s most valuable currency. Suneet Maheshwari, Chairman, Udvik Infrastructure, believes private participation hinges on governance culture as much as policy. “Confidence-building measures are critical,” he says. “Dispute resolution mechanisms, responsiveness to genuine issues and consistency in decision-making strongly influence investor appetite.”He also underlines the importance of predictable project sequencing. “Bidding teams are small. When too many projects are released simultaneously, it  leads to over-aggressive bidding and compromises quality,” Maheshwari observes.The road aheadAs 2026 takes shape, the contours of India’s road pipeline are getting clearer. The Centre will concentrate on strategic depth and completion of legacy assets. States will drive urban connectivity. For industry stakeholders, success will depend on balancing exposure across both, prioritising cash flow security, investing in technology and aligning with sustainability objectives.“Those who master contracts, corridors and cash flow will be the winners,” says Lt Gen Chaudhry. In the next phase of India’s road journey, where projects flow may matter less than how well they are conceived, executed and sustained.(The above insights were shared during a webinar titled “State vs. Centre: Where Will Road Projects Flow?” hosted by Construction World.)