The National Assembly has passed the National Infrastructure Fund Bill 2026, paving the way for the establishment of a new investment vehicle aimed at financing major infrastructure projects.

Treasury Cabinet Secretary John Mbadi welcomed the development, saying the fund will support economic growth while helping the country reduce reliance on debt.

In a statement shared on March 5, 2026, Mbadi said the fund would mark a new approach to financing infrastructure development in Kenya.

“The passage of Infrastructure Fund Bill 2026 in @NAssemblyKE that paves way for creation of the first of a kind Investment Fund in Kenya is not only a game changer in unlocking Kenya’s economic potential by accelerating growth but will also ease debt pressure. Let’s join hands,” Mbadi said.

Creation of National Infrastructure Fund

The new law establishes the National Infrastructure Fund (NIF), which is expected to mobilise resources for key projects across sectors including transport, energy, water, irrigation and digital connectivity.

The fund will support development of highways, railways, ports, agribusiness infrastructure and other strategic national projects.

Unlike previous models that largely relied on borrowing to finance infrastructure development, the NIF is designed to attract investments from both public and private sources.

Part of the funding will come from proceeds generated through privatisation and partial divestiture of state-owned enterprises, while private sector participation is expected through public-private partnerships.

Officials say the approach is intended to reduce pressure on public borrowing while supporting large-scale infrastructure investments.

KPC IPO to support infrastructure fund

The passage of the Bill comes days after the government announced the Initial Public Offering (IPO) of Kenya Pipeline Company (KPC) at the Nairobi Securities Exchange.

The government offered 1.8 billion shares at a price of Sh9 each as part of a broader plan to divest part of its stake in the company.

According to the Treasury, the offer attracted applications for 12.49 billion shares, representing an oversubscription of more than 100 per cent.

Proceeds from the sale are expected to form part of the seed capital for the National Infrastructure Fund.

Oversight and project financing

Mbadi has previously told parliamentary committees that the fund will focus on commercially viable and bankable projects capable of attracting private investment.

The Treasury has indicated that the fund will be managed under a governance structure that includes an independent board and professional management.

The framework is expected to include accountability and oversight mechanisms aimed at ensuring transparency in the management of the fund and protection of public resources.

The government says the National Infrastructure Fund will help finance priority projects while reducing reliance on traditional debt financing for infrastructure development.