Maha to soon let municipalities raise funds via bonds

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Maharashtra chief minister Devendra Fadnavis said his administration will soon allow municipal corporations to raise funds by selling bonds in the market to enable them to undertake various infrastructure projects.

“I agree flexibility is needed for municipal corporations to raise money. For various reasons, in the last many years, they were not allowed to do so. I assure that immediately we will permit them to raise funds by selling bonds,” Fadnavis told a gathering of industrialists and planners here to discuss the ways and means to make the megapolis a global financial hub.

He, however, said the funds raised should be utilised well and in time.

“Raising funds is not an issue. The area of concern is don’t just raise funds, but also spend them. There are outlays but no outcomes. Nearly 30-40 per cent of the capital raised is unutilised. We have big plans to raise funds, but what is more important is to spend it in proper manner and in right time,” he said.

Brihanmumbai Municipal Corporation (BMC) Commissioner Sitaram Kunte said the civic body had been seeking permission from the previous UPA government to raise funds, but they were never approved.

“We had sought permission from the previous UPA government to raise up to Rs. 2,000 crore through bonds. But they never approved it…They must be having some reasons for it. But with the chief minister assuring us, we think we can easily raise Rs. 5,000 crore through bonds,” he said.

Kunte further said these funds would be utilised to create better infrastructure. “We will use the funds to create better infrastructure in the city, which we plan to make more competitive and inclusive,” he said.

It can be noted that the richest civic body in Asia earlier this week has allocated only a paltry sum for two large infra projects in the city out of its over Rs 33,400 crore annual budget, as more than half its annual planned expenditure is spent on its moribund army of employees. The BMC’s annual budget is larger than that of many small states.