Details of the UIDF

Details of the UIDF

Details of the UIDF:

#GS II #Government Policies and Interventions

Topic Government Policies and Interventions


  • To make the best use of its resources, the Urban Infrastructure Development Fund, established to support the development of Tier II and Tier III cities, should give priority to ongoing projects, fund essential services, and encourage initiatives that reduce carbon footprints.
  • These are only a few of the numerous laws that will probably be created to implement the UIDF programme. A $10,000 billion budget line item was set aside for the project in the general budget for this year.

UIDF (Urban Infrastructure Development Fund) information:

  • The UIDF will be financed by the shortfall in loans made to the prioritised sectors.
  • The money will be used by government organisations to build urban infrastructure in Tier 2 and Tier 3 cities.
  • The National Housing Bank will be in charge of managing it.
  • It will be established in a manner similar to that of the Rural Infrastructure Development Fund (RIDF).
  • States will be urged to charge reasonable access fees to the UIDF using funds from existing programmes and grants from the 15th Finance Commission.

What do cities in tiers two and three mean?

  • Between 20,000 and 50,000 people live in Tier 3 cities, and between 50,000 and 100,000 people live in Tier 2 cities.

About RIDF:

  • The government established the RIDF in 1995–1996 to allocate funds for ongoing rural infrastructure projects.
  • The National Bank for Agriculture and Rural Development is in charge of the Fund (NABARD).
  • Contribution: Because agriculture is the sector’s designated priority, domestic commercial banks contribute to the Fund an amount equal to their shortfall in lending to that industry.
  • The primary goal is to provide loans to state governments and state-owned businesses so they may finish existing infrastructure efforts for rural areas.
  • The loan must be returned in equal annual installments following a two-year grace period and seven years from the withdrawal date.

 Source  The Hindu