What does the Budget offer urban India?, Pg12

Key Highlights:

• The Union Budget 2026 reduced the central outlay for urban development from ₹96,777 crore to ₹85,522 crore, an 11.6% decrease.
• Metro rail projects continue to dominate urban allocations, accounting for approximately 33.6% of all central urban spending with an allocation of ₹28,740 crore.
• Allocations for flagship urban schemes like PMAY-U, SBM-U, and AMRUT have been reduced by 5.9%, 50%, and 20% respectively.
• The budget cuts occur amidst rising urban migration, unemployment, climate shocks, and infrastructure backlogs.

Detailed Insights:

• The reduction in urban development spending signals a shift in the government's perception, viewing it as a residual category rather than a growth-critical investment.
• Despite the importance of metro rail projects, the budget overlooks proportional investment in more inclusive and scalable solutions like bus-based public transport and non-motorised transport.
• Cuts to PMAY-U may exacerbate urban housing shortages, affordability issues, and the expansion of informal settlements.
• The significant reduction in SBM-U funding raises concerns about the sustainability of urban cleanliness and public health initiatives, especially regarding waste processing and worker safety.
• Decreased funding for AMRUT poses challenges to achieving universal water and sewerage access, particularly in cities facing groundwater depletion and climate-induced variability.
• Urban local bodies remain fiscally weak and dependent on tied transfers, limiting their ability to plan long-term infrastructure and service delivery.
• The budget's emphasis on capital-heavy projects over everyday systems may hinder the creation of liveable, equitable, and resilient cities.

Key Concepts Involved:

• Viksit Bharat: The Indian government's vision of a developed India, emphasizing economic growth, productivity, and global competitiveness.
• Centrally Sponsored Schemes: Programs funded by the central government but implemented by state governments.
• Fiscal Devolution: The transfer of financial resources and decision-making power from the central government to lower levels of government, such as urban local bodies.