Urban Development Ministry Seeks Release of Rs 17 Billion for 533 Stalled Projects

The Ministry of Urban Development has moved to unlock funding for hundreds of development projects that were earlier put on hold, submitting a proposal to the Ministry of Finance to release the budget for 533 projects. These projects carry a combined estimated cost of around Rs 17 billion and form part of a larger pool of 1,280 schemes currently stalled under the ministry.

The development budgets were frozen following a Cabinet decision taken after the formation of the government led by Sushila Karki, which temporarily halted infrastructure and development spending worth more than Rs 110 billion in the name of fiscal discipline. The freeze was guided by a Finance Ministry circular that barred funding for projects lacking adequate preparation, those considered low priority, or schemes fragmented across provincial and local levels.

Officials at the Urban Development Ministry say the projects proposed for release have completed required preparations and have been recommended by local governments. The ministry has expressed confidence that reviving these projects would help restart development activity and ease pressure on the wider economy. However, a final decision will require approval from the Council of Ministers, as experts caution that prolonged budget freezes risk slowing economic momentum and increasing unemployment.