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On March 4, 2026, the Government of Canada launched a call for proposals for Stream 2 of the Arctic Infrastructure Fund (the Fund), Investing in Industry and Community-led Transportation Infrastructure with Dual-use Benefits. The CA$1 billion, four-year program (2025-26 to 2028-29) will support transportation infrastructure projects in Canada's Arctic that provide both community and defence benefits.
Objectives of the fund
Announced in November 2025 by the Minister of Transport, the Fund aims to:
- Strengthen defence readiness and Canada's capacity to operate in the Arctic;
- Improve transportation links that support economic development and access to domestic and global markets;
- Enhance community connectivity and improve access to essential goods, services and emergency response; and
- Advance Indigenous reconciliation.
The Fund will support the construction of new dual-use transportation infrastructure that connects northern communities and addresses existing constraints affecting airports, ports, highways and other trade and logistics-enabling assets across the North.
Dual-use is infrastructure that provides benefits not only for the community where the investment occurs, but also to the Department of National Defence and Canadian Armed Forces.
Stream 2 program details
Through this open call for proposals, the Government of Canada intends to advance Arctic and Northern priorities, by:
- Addressing local priorities such as improving regional connections, addressing service gaps, improving infrastructure;
- Strengthening the reliability and continuity of travel and providing alternate routes, like new connecting roads that help move people, equipment and goods;
- Improving connections to resource-rich areas supporting regional economic development, including trade and tourism;
- Enhancing infrastructure resilience against climate change through new designs, technologies, or materials that mitigate the risks and impacts of climate change;
- Improving capacity for emergency response operations; and
- Enabling, where possible, operational mobility or use by the Department of National Defence and the Canadian Armed Forces.
Eligibility
To be eligible, the transportation infrastructure project must be situated in Yukon, Northwest Territories, Nunavut, the Nunavik region of Québec and the Nunatsiavut region of northern Labrador.
Eligible project types include airport infrastructure, port development or expansion, sealift area relocation, expansion or improvement, ferry terminals, all-season roads, highways or inter-community roads, access roads to ports, airports, sealift areas, rail infrastructure, digital infrastructure and intermodal hubs.
Eligible applicants include provinces and territories, municipalities, Indigenous organizations, and Canadian not-for-profit and for-profit private sector organizations incorporated or registered in Canada.
Funding
Transport Canada may contribute up to 75% of the total eligible project expenditures, except for P3 projects, for which the maximum contribution is 33%. The requested federal contribution per project also must not exceed CA$500 million.
Funding may be provided through unconditionally repayable, conditionally repayable and non-repayable contributions. Projects expected to generate profit will generally receive repayable contributions, although the program may consider partial or full non-repayable contributions in specific circumstances.
Eligible expenditures include:
- Professional fees for contracted services (design, engineering and planning);
- Project management activities;
- Environmental assessments and consultation;
- Staff salaries and benefits that are directly related to construction;
- Material and preparation costs, including site preparation; and
- Construction, rehabilitation and improvement of assets.
Land acquisition costs and real estate fees, leasing costs for land, buildings and facilities, legal costs, project proposal or development costs and costs incurred prior to the signature of the Contribution Agreement or the approval-in-principle letter, if applicable, or after the final claim date are considered ineligible expenditures.
For projects with revenue-generating potential, the Canadian Infrastructure Bank (CIB) will review submitted proposals to determine whether they may also qualify for CIB financing. In some cases, projects may receive a combination of CIB financing and funding from the Fund, ensuring that applicants receive the combination of funding and financing best suited to successful project delivery.
Proposal requirements
Project proposals must demonstrate the degree of pre-construction readiness, including the status of Indigenous consultation and/or adherence to modern treaty obligations. Proposals must also:
- Describe the intended use of the asset;
- Demonstrate how the project advances Indigenous reconciliation, including how the project effectively engages with Indigenous people regarding potential impacts and seeks to maximize benefits for them;
- Clearly demonstrate alignment with at least two Fund objectives; and
- Outline how the asset could support dual-use applications by the Department of National Defence, the Canadian Armed Forces or the Canadian Coast Guard.
Conclusion
All Stream 2 project proposals must be submitted to Transport Canada by June 5, 2026, at 5:00 p.m. Eastern Time. As the Arctic Infrastructure Fund spans over four years, priority may be given to applicants able to demonstrate that their project will be substantially completed by December 31, 2028.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Specific Questions relating to this article should be addressed directly to the author.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
