Urban affairs ministry set to end up with non-utilisation of around 40% of allocated budget for FY26

NEW DELHI: Despite the Centre’s focus on augmenting urban infrastructure and planned urbanisation, the housing and urban affairs ministry is set to end up with non-utilisation of around 40% of the Rs 96,777 crore the budget had allocated for the current financial year, which ends in March. The total expenditure for FY 25-26 is estimated at Rs 57,204 crore.

What’s more striking is that a little over one-third of the funds allocated for Centrally Sponsored Schemes have been or will be utilised during the current financial year.

Centrally Sponsored Schemes include PM Awas Yojna, Swachh Bharat Mission, AMRUT and National Livelihood Mission. Budget documents showed that the utilisation of the allocation has been less than the budgetary allocation in most of these schemes. Out of Rs 53,604 crore allocated for these schemes for the current fiscal year, the utilisation is likely to end up at Rs 18,950 crore.




For example, against the targeted expenditure of Rs 19,794 crore for PM Awas Yojna during the current fiscal year, the ministry will end up utilising only Rs 7,500 crore. Similarly, it would be able to disburse around Rs 300 crore as interest subsidy against the target of Rs 3,500 crore, and under the scheme for industrial housing, only Rs 100 crore can be utilised against the budget estimate of Rs 3,500 crore.

Under the AMRUT mission, the expenditure is estimated to be Rs 8,000 crore compared to the allocation of Rs 10,000 crore, and in Swachh Bharat Mission, out of the allocated Rs 5,000 crore, only Rs 2,000 crore is likely to be utilised. The trend is no different in the case of the PM e-Bus scheme, which was first announced in the 2020 Budget.

Past budget documents also showed a similar trend. For example, against the total allocation of Rs 82,577 crore for 2024-25, the actual expenditure was Rs 53,255 crore.

A former urban development secretary said this trend is enough to send signals to the govt that there is a need to recalibrate Centrally Sponsored Schemes, which are implemented by states.