The Maharashtra government is evolving its own financial model to raise a Rs 500-crore corpus for development of cities/towns shortlisted under national project, Atal Mission for Rejuvenation & Urban Transformation (AMRUT).
The urgency to constitute the corpus funds through loans from World Bank or Asian Development Bank at lower interest rates spread over long term, is to fast track the ongoing 150 civic projects listed under AMRUT to provide viability gap funds to Urban Local Bodies (ULBs).
Maharashtra has shortlisted 43 cities/ towns under AMRUT. The fund-sharing formula is 50 per cent from the Centre and 25 per cent each from the state and ULBs. The Centre has committed Rs 3,500 crore. The state government will provide Rs 1,700 crore and ULB’s share required is Rs 1,750 crore. However, the government has realised ULBs with a population of around one lakh are finding it hard to meet the financial component.
The state government believes the provision for funds in the 14th Finance Commission for projects under ULBs can be routed for AMRUT under ULB share. It was noted that ULB efforts to mobilise funds often lead to an inordinate delay, cost overruns and failure to meet deadline. The ULBs take more than a year to raise their share thus thwarting the progress of AMRUT.
Chief Minister Devendra Fadnavis, after discussing the glitches with department officials, felt they have to address the financial aspects to expedite projects under AMRUT. It was felt they should mediate and evolve a financial model to support ULBs. To begin with, the Rs 500 crore corpus is being set up. In the next two years, corpus funds would be raised to Rs 800 crore. The state government’s biggest challenge is to tackle cost escalation and provide a robust financial model which can be sustained for completion of projects under AMRUT.
AMRUT is an ambitious project of the Narendra Modi government, launched in 2015. There are 500 cities/towns selected under AMRUT across India, of which 43 cities/towns are from Maharashtra. The 150 projects to be completed include water supply, sewerage, rain harvest and cleanliness drive (Swachch Bharat Abhiyaan) and civic amenities.
Principal Secretary (Urban Development) Manisha Mhaiskar said, “The purpose of the corpus funds would be to bridge the viability gap and facilitate ULBs to cope with both completion of projects in a targeted time frame and avoid increase in project cost.” Under AMRUT, all projects across 43 towns/cities are expected to be completed between 2015-2019. Although the list of projects appears common, from water supply to sewage, each ULB has its own distinct problems and challenges which have to be treated differently, she observed.
The Centre’s guidelines for each city/town based on the ratio worked in conformity with the population has been provided to every ULB. The primary objective of AMRUT is to consolidate the civic projects under local municipal corporations and councils in 43 cities/town shortlisted.
The cities/ towns selected include Greater Mumbai, Nagpur, Pune, Pimpri-Chinchwad, Nashik, Kalyan-Dombivli, Navi Mumbai, Solapur, Mira-Bhayander, Bhiwandi, Amravati, Nanded, Kolhapur, Ulhasnagar, Sangli, Nanded, Jalgaon, Akola, Latur, Dhule, Ahmednagar, Chandrapur, Parbhani, Ichalkaranji, Jalna, Ambernath, Bhusaval, Panvel, Barshi, Yavatmal, Osmanabad, Wardha, Udgir, Hinganghat, Badlapur, Beed, Gondia and Satara.