• The finance minister, in her budget speech for Financial Year 2023-24, presented a vision for Amrit Kaal and emphasized on seven priorities of the Union Budget – ‘Saptarishi’ for an empowered and inclusive economy.
  • Against this backdrop, the stage was set for a new fund i.e Urban Infrastructure Development Fund (UIDF) established through Priority Sector Lending Shortfall and to be used by Public Agencies to create urban infrastructure in Tier 2 & Tier 3 cities.
  • This fund will be managed by National Housing Bank and has been operationalised with an initial corpus of Rs.10,000 crore.
  • UIDF aims to supplement efforts of the State Governments/UTs for urban infrastructure development work implemented through Public/State Agencies, Municipal Corporations, Urban Local Bodies in Tier 2 and Tier 3 cities by providing a stable and predictable source of financing.
  • It allows for pooling of resources and expertise, enabling creation of comprehensive infrastructure solutions that address the unique needs of each urban area.
  • Eligible Activities for UIDF shall be aligned to the Missions & programmes of the Ministry of Housing & Urban Affairs (MoHUA). These shall focus on basic services like Sewerage and Solid Waste Management, Water Supply and Sanitation, etc. Impact oriented projects may be prioritized.

The list of some of the eligible activities are as under:

  • Water Supply & Sanitation
  • Solid Waste Management
  • Construction of roads (excluding maintenance works), Over bridges, grade separators, underpasses
  • Comprehensive Area Development Projects
  • Local Area Plan for de-congestion
  • Heritage Conservation
  • Town Planning Schemes for greenfield development
  • Eligible Activities for availing loans under the UIDF are aligned with the Missions and programmes of the Ministry of Housing and Urban Affairs, with a focus on basic services like sewage and Solid Waste Management, water supply and sanitation, construction and improvement of drains/storm water drains. The minimum size of a project is Rs. 5 crores (Rs. 1 crore for North-East & Hilly States) and the maximum size is Rs. 100 crores.

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