New Union government scheme pushes local bodies to move towards market-based financing of urban development (opens original article in a new tab)

The Union government's new Urban Challenge Fund pushes urban local bodies to adopt market-based financing for development projects, requiring 50% funding from bonds, loans, and PPPs with 25% central grant.

• The Union government's Urban Challenge Fund (UCF) requires 50% of project costs to be funded via bonds, bank loans, and PPPs with 25% central grant
• Local bodies must implement urban reforms and adhere to UCF guidelines for project preparation, appraisal, financing, and monitoring
• The scheme aims to attract ₹4 lakh crore in investments by providing up to 25% Central assistance for urban projects