Singh, who had reviewed the working of the union territories division of his Ministry, also issued various directives, including for building bridges in Daman and Diu and promoting tourism in the Andaman and Nicobar Islands.
Talking about Puducherry, Singh directed the senior officials that "precarious financial position of UT of Puducherry should be closely and effectively monitored by MHA," a statement by the Ministry said.
Puducherry Lt Governor Virendra Kataria had earlier this month urged Prime Minister Narendra Modi to allocate adequate funds for the all-round development of the Union territory.
In March this year, former Minister of State in PMO V Narayanasamy had charged Puducherry Chief Minister and AINRC leader N Rangasamy with "misleading" people by spreading wrong propaganda against the UPA government that the Centre had not made available sufficient funds available for Puducherry.
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He claimed that of the Rs 2250 crore sanctioned for 2012-13 fiscal, the UT government had spent only Rs 1270 crore.
Meanwhile, the Home Minister directed that the proposal for construction of three bridges in Daman and Diu to be expedited.
He added that the Action Plan for cleaning of Daman Ganga River should be prepared in three months time by the Daman and Diu Administration.
He underlined that tourism should be promoted in the Andaman and Nicobar Islands and Lakshadweep, safeguarding the ecological balance and keeping in view the security aspects.
On listing of heritage buildings by the Heritage Conservation Committee in Chandigarh, Singh said that private properties should not get adversely affected by this exercise.