The Union Cabinet has approved the ‘Urban Challenge Fund’ to help Indian cities become more resilient, sustainable, and modern. The fund will provide central assistance covering 25% of the total project cost.
To be eligible for support, cities must raise at least 50% of the project cost from the market. This can include financing through municipal bonds, bank loans, or public-private partnerships (PPP). Officials said this approach encourages cities to mobilise additional resources while ensuring accountability and efficiency.
The fund will support projects aimed at improving urban infrastructure, climate resilience, water management, transport, and smart city initiatives. Experts said it will help cities adopt innovative solutions, attract private investment, and enhance public services.
Authorities highlighted that the Urban Challenge Fund is part of the government’s broader plan to promote sustainable urban development and improve the quality of life for city residents across India.
