Prime Minister Narendra Modi.
If you live in a big city struggling with traffic jams, water problems or weak infrastructure, then the new decision of the Central Government has brought hope of relief for you. The Union Cabinet has approved ‘Urban Challenge Fund’ to change the face of cities. A huge amount of Rs 1 lakh crore has been arranged through this fund, which will give a new direction to the urban development of the country.
After all, what is this new plan of the government?
The government has made it clear that now the development of cities will not happen on the old pattern. Under this new initiative, cities with population of more than 10 lakh, state capitals and major industrial cities have been included. The mathematics of the scheme is very interesting and yielding results. The central government will itself bear 25% of the cost of a project, but a big condition has been set for it. The condition is that at least 50% of the money for the project will have to be raised from the market.
This step of the government is not limited to just giving money from the government treasury, but its objective is to make the cities economically self-reliant. It is expected that this initiative will bring huge investment of about Rs 4 lakh crore in urban areas in the next five years. That means, with a little help from the government, a lot of money from the market will be invested in the development of cities.
Cities will become the engine of country’s progress
Former CEO of NITI Aayog, Amitabh Kant has described this decision as historic. He has termed this scheme as the biggest engine of development of the country. He says that the hesitation that was there earlier regarding urbanization in India is now ending. He wrote an important thing on X (formerly Twitter) that urbanization will be the biggest agent of India’s development in the coming decades.
If we look at the figures, India’s urban system is the second largest in the world. 11 percent of the world’s urban population lives in Indian cities alone. This number is more than the total urban population of America, Germany, Japan and UK. Amitabh Kant believes that this fund will bring a revolutionary change in the cities, which will not only improve the infrastructure but will also improve the lifestyle of the people.
Now you will get money on the basis of performance
Till now cities had to rely on government grants, but now the attitude has changed. According to the government statement, this scheme marks a move away from ‘grant-based’ funding towards a ‘market-linked’ and ‘result-oriented’ model. That is, only those cities which will improve, bring the private sector on board and pay attention to the facilities of the citizens, will get the benefit.
The main objective of this fund is to prepare cities for future challenges. Cities will no longer just become a place to live but will also become ‘growth centres’ i.e. centers of economic growth. This scheme will be effective starting from the financial year 2025-26 till 2030-31, which can be extended till 2033-34 if needed.
