PWD and Urban Development Minister Vikramaditya Singh participated in a meeting held under the chairmanship of Union Minister for Housing and Urban Affairs Manohar Lal Khattar at New Delhi last evening. Detailed discussions were held on Urban Challenge Fund during the meeting.
Vikramaditya Singh said that the State Government has proposed projects amounting to approximately Rs. 5,400 crore under the Urban Challenge Fund to create robust infrastructure and vibrant economic hubs in urban areas of the State. He requested the earmarking of Rs. 1,350 crore to Himachal Pradesh as the Central Government share, keeping in view the small size and limited revenue base of Urban Local Bodies. He added that private sector participation in re-development projects remains limited due to terrain-related constraints and lower commercial viability. He also demanded specific relaxations for hill and special category states like Himachal Pradesh under the Urban Challenge Fund keeping in view these challenges.
He stressed upon suitable relaxation in the population criteria prescribed for coverage, and modification of the funding pattern by reducing the mandatory requirement of mobilizing 50 percent of the project cost through bonds, bank loans and PPPs. He urged for considering higher proportion of Central assistance or viability gap support while finalizing the modalities, keeping in view the limited financial capacity of Urban Local Bodies and low private sector participation in hill regions.
Vikramaditya Singh also sought the support of the Government of India in facilitating resource mobilization for the State under the Urban Challenge Fund, including enabling access to institutional finance and innovative funding mechanisms. Further, support in attracting private investment and credible developers through appropriate policy backing and handholding would be invaluable for successful project implementation, he added.
He said that the Urban Challenge Fund is of critical importance for a hill State like Himachal Pradesh where nearly 90 percent of the area is mountainous and about 67 percent is under forest cover, leaving limited land for development. Urbanization is further constrained by fragile ecology and rapidly rising tourist footfall which places immense pressure on limited infrastructure, he said.
He said that the Urban Challenge Fund is not merely financial support but a key enabler for developing resilient growth centres that support tourism, generate employment and improve quality of life.
The Minister apprised that the State Government has prepared a set of integrated, climate-resilient and tourism-oriented urban infrastructure projects for support under the Urban Challenge Fund which include decongestion and redevelopment of core areas. These include peripheral CBD development, smart parking, skywalks and heritage façade improvement.
He said that mobility solutions tailored for hill towns, such as hydraulic parking, lifts and escalators, which address land scarcity, are also proposed. He further said that redevelopment of traditional market areas is proposed to modernize infrastructure, improve safety and boost local economic activity, especially for small businesses. He added that underground utility ducting is essential for ensuring reliable services in disaster-prone hill regions while improving urban aesthetics and enabling future-ready infrastructure.
He said that State Government was also proposing an Integrated Wellness Eco-tourism Centre with a skywalk, aligning with India's wellness tourism vision while ensuring minimal ecological impact.
The Minister sought support for planned townships which will attract private investment, generate employment and reduce pressure on existing hill towns.
He said that urban governance was being strengthened through Integrated Command and Control Centres, which are critical for disaster response, traffic management and efficient delivery of citizen services.
The Minister said that State Government has also proposed cluster-based integrated solid waste management systems to scientifically process waste, protect environment and sustain tourism.
The Central Government has requested Himachal government for prioritising the projects and Submitting projects worth 1,100-1,200 crores under which 25 percent amount will be released as central assistance and remaining fund state has to mobilise through PPP or loan from financial institution.
Director Urban Development Dr. Neeraj Kumar also accompanied the Minister.
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