NEW DELHI: The core of the new ₹1 lakh crore Urban Challenge Fund will focus on redeveloping abandoned public buildings, repurposing unused government land such as old prisons and granaries, and engaging the private sector, while promoting municipal reforms to transform cities in India.
The Ministry of Housing and Urban Affairs has developed guidelines for this Urban Challenge Fund, which was introduced by Union Finance Minister Nirmala Sitharaman during her budget speech.
This fund is anticipated to be a significant central assistance initiative for urban transformation in around 300 cities, each with populations exceeding 100,000, competing for project funding.
According to high-level sources, cities will identify specific projects addressing drainage, sanitation, and other infrastructure issues, and engage private partners for implementation.
The government will prioritize proposals that involve utilizing government land from old prison complexes and abandoned properties to meet the current needs of cities.
In a change from previous missions, the Centre will contribute only 25% of the project costs, while states and private partners will cover the remaining expenses.
A senior official, who requested anonymity, stated, “We will emphasize redeveloping congested areas. City boundaries have expanded, leading to haphazard colony developments around abandoned government complexes. These prime government properties can be monetized. Our guidelines will offer incentives for retrofitting and redevelopment of these areas, with the private sector being central to these initiatives.”
Sitharaman outlined the Urban Challenge Fund’s framework during her budget address in July, highlighting the plans to establish a fund of ₹1 lakh crore aimed at initiatives for ‘Cities as Growth Hubs’, ‘Creative Redevelopment of Cities’, and ‘Water and Sanitation’.
