The Union Cabinet cleared the Urban Challenge Fund with ₹1 lakh crore of central assistance, aiming to leverage ₹4 lakh crore of total investment over five years. First announced in the 2025-26 Budget, it will run from FY 2025-26 to FY 2030-31, extendable to 2033-34. Cities above 10 lakh population, all State capitals and key industrial cities above 1 lakh are eligible. The Centre will fund 25% of project cost, at least 50% must come from markets, and States or ULBs will provide the remaining 25%.