Centre Launches Urban Infrastructure Development Fund (UIDF) To Boost Tier 2 And Tier 3 Cities

In a significant move to bolster urban infrastructure in Tier 2 and Tier 3 cities, the government has established the Urban Infrastructure Development Fund (UIDF) utilising the priority sector lending shortfall. The UIDF is designed to complement the efforts of state governments in the development of urban infrastructure projects executed through Public/State Agencies, Municipal Corporations, and Urban Local Bodies. 

This initiative aims to provide a stable and predictable source of financing to expedite crucial urban development works. The National Housing Bank will oversee the management of the fund.

The UIDF will play a pivotal role in supporting eligible activities aligned with the Missions and programmes of the Ministry of Housing and Urban Affairs. Emphasis will be placed on enhancing basic services such as sewerage and solid waste management, water supply and sanitation, as well as the construction and improvement of drains and stormwater drains.

Projects seeking loans under the UIDF must adhere to certain criteria, with the minimum project size set at Rs. 5 crores (Rs. 1 crore for North-East and Hilly States) and a maximum limit of Rs. 100 crore.

The initiative was shared by the Minister of State in the Ministry of Housing and Urban Affairs, Shri Kaushal Kishore, in a written reply in the Rajya Sabha. The establishment of the UIDF reflects the government's commitment to fostering urban development in smaller cities, ensuring they receive the necessary financial backing for critical infrastructure projects. This strategic move is anticipated to have a positive impact on the overall urban landscape and improve the quality of life in Tier 2 and Tier 3 cities across the country.