Government of India Government of India

Integrated Development of Small & Medium Towns

The total population of the country has increased from 361 million in 1951 to 1027 million in 2001, whereas, urban population has increased from 62 million to 285 million during the same period. The number of metropolitan cities has increased from 23 in 1991 to 35 in 2001. Thus, it is, evident that there was a clear shift towards large towns, perhaps due to lack of employment opportunities and poor urban infrastructural base of the small and medium towns. The Centrally sponsored scheme of Integrated Development of Small & Medium Towns (IDSMT) was initiated in the year 1979 80 and is continued with timely amendments and modifications upto2004-2005 and in December 2005 it was subsumed in UIDSSMT Scheme. Investment in the development of small urban centres would help in reducing migration to large cities and support the growth of surrounding rural areas as well.

Objectives of IDSMT:

The main objectives of IDSMT scheme are:

  • Improving infrastructural facilities and helping in the creation of durable public assets in small and medium towns.
  • Decentralizing economic growth and employment opportunities and promoting dispersed urbanization. 
  • Increasing the availability of serviced sites for housing, commercial and industrial uses.
  • Integrating spatial and socio-economic planning as envisaged in the Constitution (74th Amendment) Act, 1992. 
  • Promoting resource generating schemes for the urban local bodies to improve their overall financial position.

Selection of towns:

  • IDSMT Scheme will be applicable to towns/cities with population upto 5 lakhs. 
  • Towns are to be identified and prioritized by the State Governments and UTs according to their Urban Strategy within the framework of Guidelines of the Scheme. 
  • The IDSMT Scheme will be applicable to only those towns where elections to the local bodies have been held and elected bodies are in position.

Components for Funding

  • Strengthening of Master Plan road facilities including ring, arterial, bypass/link roads and small bridges,
  • Sites and services,
  • Development of bus/truck terminals,
  • Construction/upgradation of Master Plan drains including Storm water channels,
  • Solid waste management
  • Development of market complexes/shopping centers,
  • Provision of tourist facilities,
  • Development of City/Town Parks
  • Street lighting for Master Plan roads,
  • Slaughter houses,
  • Major public amenities like Gardens, Playgrounds, Marriage halls, Pay and use toilets, etc.
  • Cycle/Rickshaw stands,
  • Traffic improvement and management schemes,
  • Construction of retaining walls and slope stability measures in hill station towns,
  • Social amenities, especially for the poorer sections.

Funding pattern

Central assistance and State share provided under IDSMT scheme to the local bodies is in the form of grant.

(Rs. in lakhs)

Category of Town (Population) Project Cost Maximum Central Assistance (Grant) State Share (Grant) HUDCO/Financial Institutional Loan/Other Sources
A (< 20000) 100 48 32 20 (20%)
B (20000‑50000) 200 90 60 50 (25%)
C (50000‑100000) 350 150 100 100 (29%)
D (1 – 3 Lakhs) 550 210 140 200 (36%)
E (3 – 5 Lakhs) 750 270 180 300 (40%)

To enable the preparation of project reports under IDSMT Scheme grant-in-aid will be available to State Governments/Municipalities on 60(Central grant) : 40(state grant) basis with total cost restricted to Rs.3.00 lakh to towns with population up to 50000, Rs.4.00 lakh for towns with population between 50000 and 1 lakh, Rs.5.00 lakh for towns with population between 1 and 3 lakhs and Rs.6.00 lakhs for towns with population between 3 and 5 lakhs under the Central Urban Infrastructure Support Scheme (CUISS).

Appraisal and processing
The State Government/UTs have to prepare and send detailed project report in the prescribed format to the Town and Country Planning Organisation (TCPO) for scrutiny and appraisal.The State Level Sanctioning Committee (SLSC) considers appraisal reports prepared by TCPO and recommends for release of central assistance to the Government of India.

Implementation status report Download

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