Big push for cities as Urban Affairs allocation jumps to Rs 96,777 Cr, gets 52% funding boost: Check other sectors

The Ministry of Housing and Urban Affairs (MoHUA) has received a sharp boost in funding in the Union Budget 2025–26, with an allocation of Rs 96,777 crore, a 52 per cent increase over the revised estimate of Rs 63,670 crore in 2024–25. The allocation accounts for around 1.9 per cent of total central government expenditure and roughly 0.3 per cent of India’s GDP, indicating renewed focus on urban infrastructure, housing, and public transport.

Of the total outlay for 2025–26, the Ministry plans to spend 61 per cent on revenue expenditure and the remaining 39 per cent on capital expenditure. Revenue spending has been budgeted at Rs 59,154 crore, an 85 per cent rise from the revised estimate of the previous year, while capital expenditure has been pegged at Rs 37,623 crore, up 19 per cent.

Urban transport continues to dominate the Ministry’s spending priorities. Mass Rapid Transport Systems (MRTS) and metro rail projects account for the largest share of the budget, with an allocation of Rs 34,807 crore, or 36 per cent of the total outlay. This marks a 22 per cent increase over the revised estimate for 2024–25, reflecting the government’s push to expand metro networks and ease congestion in cities.

PMAY–Urban

Housing remains another major focus area as PMAY–Urban, including PMAY 2.0, has been allocated Rs 23,294 crore, making up 24 per cent of the Ministry’s budget and registering a 54 per cent increase over the previous year’s revised estimate. The Atal Mission for Rejuvenation and Urban Transformation (AMRUT), aimed at improving basic urban services such as water supply and sewerage, has also seen a substantial rise, with allocations jumping 67 per cent to Rs 10,000 crore.

Several new and expanded initiatives feature prominently in the budget. A fresh allocation of Rs 10,000 crore has been announced for the Urban Challenge Fund, while Rs 2,500 crore has been earmarked for a new industrial housing scheme. Funding for the Swachh Bharat Mission–Urban has more than doubled to Rs 5,000 crore, and the PM e-Bus Sewa scheme has seen a 162% increase to Rs 1,310 crore. In contrast, no allocation has been made for the Smart Cities Mission in 2025–26.