Institutional development and capacity-building requirements for strengthening solid waste management systems are mainly dependent on financial assistance. At this stage the Component 2 provides grants to local bodies to improve their solid waste management systems with a focus on the collection and transportation of solid waste.

As a prerequisite, urban local bodies need to sign a participation agreement. With this participation agreement, grants will be released to the local bodies over and above their existing plan fund allocations. For grant allocation, a two-tranche system, comprising a Basic Grants and an Incentive Grants will be executed. Grants will be allocated to local bodies on a per-capita basis, based on investment needs. For the project duration, the per capita amount may differ for the 6 municipal corporations and 87 municipalities depending on the activities they need to undertake.

Allocation of Grants

  • Provides grants to ULBs for strengthening SWM activities
  • Two types of grants-
    (a) Basic Grant (upto 40% of Grant Allocation Ceiling)
    (b) Incentive Grant (upto 60% of Grant Allocation Ceiling)
  • Basic grants will be available once ULBs sign a participation agreement
  • Incentive grants will be sanctioned only on meeting certain project criteria

Eligibility Criteria of Grant Allocations

Grant allocation ceiling Eligibility Criteria
Basic Grants (40%) Available once ULBs sign a Participation Agreement
Incentive Grants (40%)



ULBs must have fulfilled all following three conditions:

  • Prepared a 5-year city-wide plan for climate-smart and
  • Disaster-resilient SWM, which has been approved by SM
  • Issued SWM by-laws that incorporate the principles of Government of Kerala’s new SWM strategy
  • Confirmed access to/use of facility for safe disposal of waste
Incentive Grants (20%)



5% grants on fulfilling each of the following four conditions:

  • Hired top two-level staff as per SWM org. structure approved by government of Kerala
  • Signed performance-based contracts for waste collection and
  • Transportation services
  • Plan developed for levying user charges and Operation & Maintenance budgeting
  • Implemented monitoring and evaluation including grievance redressal mechanism

The component provides grants to the participating ULBs for improving their local level SWM systems and capacities, mainly:

  • Primary collection and transportation systems for solid waste
  • Source segregation and treatment for Biodegradable waste
  • Rehabilitation of the existing material collection facilities (MCFs) or resource recovery facilities (RRFs) and development of new integrated MRFs
  • Development of BDW management facilities
  • Closure or remediation of existing dumpsites and development of disposal cells as interim disposal facility
  • Public space cleaning, sanitization and waste removal activities
  • Protective gears and other equipments for sanitation and waste management workers
  • Operations and maintenance payments for contracts and tipping fee for regional disposal
  • Implementation of environment and social risk mitigation actions
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