Urban Challenge Fund Approves Rs 31,000 Crore Projects, Says MoHUA

New Delhi, Jul 21 (KNN) Projects worth Rs 31,000 crore have been approved under the Urban Challenge Fund within 20-25 days of the scheme's guidelines being finalised, D. Thara, Additional Secretary, Ministry of Housing and Urban Affairs, said at the ninth edition of the FICCI Urban Infrastructure and Innovation Summit.

She said financing for the approved projects is being mobilised from multiple sources, with 44 percent coming from non-banking financial companies (NBFCs), 22 percent through public-private partnerships (PPPs), 5-7 percent from bonds, and the remaining from commercial banks.

Shift Towards Challenge-Based Urban Financing

HUDCO Chairman and Managing Director Sanjay Kulshrestha said Indian cities contribute 60-70 percent of the country's GDP while occupying only about 3 percent of its land area.

He described the Urban Challenge Fund as a shift from subsidy-driven programmes to a challenge-based financing model. 

Under the scheme, viability gap funding can cover up to 50 percent of project costs, shared equally by the Centre and state governments, with the remaining funding mobilised through lenders and private investors.

Experts Call For Greater Private Sector Participation

Jagan Shah, Professor of Practice, IIT Delhi's Transportation Research and Injury Prevention Centre, said the private sector should play a larger role in driving urban renewal, particularly in tier-II and tier-III cities where local implementation capacity remains limited.

Focus On City Economic Regions

J.V.S. Ramakrishna, Lead, FICCI's Core Group on Urban Development and CEO, ParadigmIT Cybersecurity, said economic planning should increasingly be organised around city economic regions rather than municipal boundaries.

He said the success of urban centres should be measured by their ability to attract investment, generate employment, foster innovation and create sustainable economic value.

FICCI Director General Jyoti Vij said urban development now extends beyond physical infrastructure to include governance, technology and financing, reflecting the evolving priorities of India's urban growth strategy.

(KNN Bureau)