Lok Sabha Question No. 2450 (UNSTARRED), answered on 2025-03-13
Subject: New Initiatives for Tier-2 and Tier-3 Cities
Ministry: HOUSING AND URBAN AFFAIRS
Asked by: Shri Zia Ur Rehman

## GOVERNMENT OF INDIA

## MINISTRY OF HOUSING AND URBAN AFFAIRS LOK SABHA UNSTARRED QUESTION NO. 2450

## TO BE ANSWERED ON MARCH 13, 2025

## NEW INITIATIVES FOR TIER-2 AND TIER-3 CITIES

## NO. 2450.    SHRI ZIA UR REHMAN:

Will  the  Minister  of  Housing  and  Urban  Affairs  be  pleased  to state:

- whether  the  Government  agrees  with  the  view  that  urban planning needs to account for higher growth of population and requisite needs and creation of infrastructure needs to be fast tracked  and  de-bottlenecked,  suburban  areas  need  to  be developed  to  provide  more  options  for  the  citizens  to  move towards the Tier-2 and Tier-3 cities and towns to create more opportunities and develop them as hubs for different sectoral,
- (a) industrial and economic activities;
- (b) if so, the details of the initiatives proposed to be taken by the Government in this regard; and
- (c)
- if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF HOUSING AND URBAN AFFAIRS (SHRI TOKHAN SAHU)

- (a) to (c): As per 12th Schedule of the Constitution of India, urban planning  including  town  planning  is  the  function  of  Urban  Local Bodies (ULBs)/ Urban Development Authorities. Government of India supplements the efforts of the States through schematic interventions/ advisories.

Government  is aware of the urban planning needs and augmentation of urban infrastructure for the growing urban population. For improving infrastructure in urban areas, Ministry of Housing and Urban Affairs ( MoHUA ) runs various schemes such as Atal  Mission  for  Rejuvenation  and  Urban  Transformation ( AMRUT ) with  a  focus  on  core  infrastructure  sectors  like  water,  sewerage, drainage, urban transport and parks in 500 cities . To carry forward the objective of universal coverage of water supply from 500 cities to all  the  statutory  towns/ ULBs in the country, AMRUT 2 . 0 has been launched on 1 st  Oct 2021 . AMRUT 2 . 0 focuses on making the cities ' self -reliant ' & ' water  secure '. Providing  universal  coverage  of sewerage & septage management in 500 AMRUT cities is other major focus of AMRUT 2 . 0 . Rejuvenation of water bodies and development of green spaces and parks are other components of the Mission .

Further, funds have been allocated under various other schemes of the Ministry for development of infrastructure in urban areas such as Swachh Bharat Mission ( Urban ), Smart Cities Mission ( SCM ) and  Pradhan  Mantri  Awas  Yojana -Urban ( PMAY -U ) for housing.

The  Government  has  announced  the  Scheme  for  Special Assistance  to  States  for  Capital  Investment  (SSASCI)  in  2022-23, 2023-24 and 2024-25, under which States are incentivized for taking the  urban  planning  reforms.  The  details  of  urban  planning  reforms under SSACI are as under:

Scheme for Special Assistance to States for Capital Investment 2022-23 - Part - VI (Urban Planning Reforms): The reform components included Modernization of Building Bylaws by removing contradictions  and  optimizing  land  use,  Adoption  of  modern  urban planning tools like Transferrable Development Rights (TDR), Implementation  of  Local  Area  Plans  (LAP)  and  Town  Planning Schemes  (TPS),  Implementation  of  Transit-oriented  Development (ToD). Further States were incentivized for Creation of Sponge Cities, Removing Taxation for running the Buses for Public Transport.

Scheme for Special Assistance to States for Capital Investment 2023-24 - Part - III (Urban Planning Reforms): The reform components included Augmentation of human resources by hiring qualified urban planners,  Implementation  of  Town  Planning  Scheme  (TPS)/  Land Pooling Scheme, Modernization of Building Bylaws, Promoting in-situ slum rehabilitation, Transit-Oriented Development (TOD), Transferable  Development  Rights  as  planning  tool,  Strengthening natural ecosystems of urban areas through urban planning, development of waterfronts etc.

Scheme for Special Assistance to States for Capital Investment 2024-25-Part-XIII (Urban Planning Reforms): The reform components include  implementation  of  Town  planning  Schemes  /  Land  Pooling Scheme,  rationalization  of  Building  Bye-laws/  Zoning  initiatives, comprehensive parking paradigm, creative re-development of cities, Planning of Peri Urban areas, Transit Oriented Development, Technology  based  reforms,  climate  sustainability  through  urban planning, comprehensive mobility plan for ease of transit in NE/ Hilly states etc.

To give further boost to the urban infrastructure sector, in the Budget 2025-26, Government has announced setting up of an Urban Challenge Fund of ₹1 lakh crore to implement the proposals for 'Cities as Growth Hubs', 'Creative Redevelopment of Cities' and 'Water and Sanitation'.  This  fund  finances  up  to  25  per  cent  of  the  cost  of bankable projects with a stipulation that at least 50 per cent of the cost is funded from bonds, bank loans, and Pubic Private Partnership.

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