Under the Urban Challenge Fund funding structure, what

Solution

Under the Urban Challenge Fund framework, the Central government will provide 25 percent of the total project cost as financial assistance. The remaining project financing is expected to be mobilised by cities through market-based mechanisms such as municipal bonds, bank loans, and public-private partnerships. This financing structure is intended to encourage local governments to strengthen their financial capacity and mobilise private investment for urban infrastructure development. By combining public funds with market finance, the scheme seeks to expand infrastructure investment while promoting financial discipline and sustainable urban financing models.