Premium

With liabilities at Rs 2.44 lakh crore: Green bonds, entertainment tax: BMC eyes new revenue sources

Civic sources said BMC intends to raise funds, somewhere between Rs 5,000 - Rs 10,000 crore through bonds.

Written by: Nayonika Bose, Pratip Acharya

4 min readMumbaiUpdated: Feb 26, 2026 12:20 AM IST

As part of its administrative modernisation drive, the BMC also announced plans to migrate its core enterprise systems to a secure digital platform under RISE with SAP Private Cloud Engine. (Source: File)

With the civic body’s liabilities soaring to highs of Rs 2.44 lakh crore, marking a jump from Rs. 2.32 lakh crore from the previous fiscal year, The Brihanmumbai Municipal Corporation’s budget announced on Wednesday lay special focus on revenue augmentation. In what marks its first foray into bonds, the BMC is eyeing to raise municipal green bonds to finance its sustainable infrastructure such as waste water treatment and desalination plants.

According to the civic budget, of the total liability of Rs 2.44 lakh crore, Rs 2.13 crore is tied to various infrastructure projects, while the remaining Rs 31,406 crore has been earmarked for essential works across other civic departments.

Raising green bonds for its projects is among one of many initiatives announced in the budget aimed towards shoring up BMC’s finances.

Speaking during the budget presentation, BMC commissioner Bhushan Gagrani on Wednesday said that the civic body is contemplating the possibility of raising funds through bonds as it receives incentives from the government while also ensuring the funds remain tied to the project.

Civic sources said BMC intends to raise funds, somewhere between Rs 5,000 – Rs 10,000 crore through bonds.

“If you raise money through bonds for a certain project, it ensures that the funds are tied to use on the project and only ensuring fast works by preventing diversion to other projects. Raising funds for sustainable projects gives a boost to BMC’s image while ensuring Mumbai’s carbon credits in the future will improve,” said Gagrani.

The new venture of green bonds, aimed at achieving Mumbai’s climate action plan goals, comes on the heels of Union Finance Minister Nirmala Sitharaman announcing a Rs 100 crore incentive for a single municipal bond issuance in the Union Budget of 2026-27.

Story continues below this ad

To rake in funds for its major capital projects, the BMC has also charted plans to monetise its revenue generating assets through Infrastructure Investment Trusts (InvITs). According to officials, the InvIT system will own and operate income generating infrastructure assets such as roads, markets, parking lots and other commercial spaces to raise funds from retail and institutional investors without adding debt.

Eyeing to rake in an annual revenue of Rs 400 crore – Rs 500 crore, BMC has outlined plans to collect entertainment tax, which were previously levied by the state government. However, with an amendment to the Maharashtra Entertainment Duty Act, now entrusting local authorities to levy the tax, the BMC has submitted a proposal before the Urban Development department calling for entertainment tax collection.

BMC has sought to levy water and sewerage charges on unmetered properties with a carpet area of less than 500 square feet. Previously, these charges were included in property tax bills which were later issued. While officials maintained that the revival of charges are unlikely to raise revenue, the BMC is set to frame a comprehensive policy to apply water and sewerage charges based on the average daily water consumption survey of residential flats without water meters with a carpet area under 500 square feet.

Over the past year, BMC has taken efforts to auction plots across three locations including Chhatrapati Shivaji Maharaj market, Asphalt plant in Worli and a Lower Parel plot. Together, these projects are estimated to raise funds to the tune of nearly Rs 2,500 crore.

Story continues below this ad

Efforts to boost its financial health have come at a time when the BMC’s capital expenditure has touched an all time high at Rs. 48,164 crore, accounting for 60 percent of its annual budget for FY 2026-27. This marks a jump from the previous fiscal year when 58 percent of the total budget was accounted for by capital expenditure which stood at Rs. 39,159 crore.

At a time when funds for capital-intensive projects account for a lion’s share of the expenditure, BMC’s reserve funds have witnessed a marginal dip this year as well. The civic body’s reserves in fixed deposits stand at Rs 81,449.32 crore at present, of which Rs 44,826.23 crore is committed to liabilities such as provident fund, pension fund, gratuity, and security deposits from contractors. Last year, BMC had fixed deposits of Rs 81,774.42 crore.

Nayonika Bose

Nayonika Bose is a Senior Correspondent with The Indian Express’ Mumbai bureau. While in the early stages of her career, her focused reporting on local governance and community welfare already demonstrates clear Expertise and Trustworthiness in covering essential civic issues impacting Mumbai's residents. Expertise & Authority (E-E-A-T) Specialized Focus: Nayonika's reporting is dedicated to civic and community issues, providing readers with highly relevant, ground-level information about the functionality and administration of India's largest metropolitan area. Core Coverage Areas: Her articles highlight a strong focus on the fundamental quality of life and public safety in Mumbai, including: Civic Infrastructure: Reports on critical failures and initiatives related to public works, such as the recurring problem of unauthorized building collapses in Navi Mumbai, the construction of new infrastructure projects (like the Dahisar-Bhayandar Link Road and the Mahalaxmi cable-stayed bridge), and the maintenance of essential city services (e.g., manhole cover theft). Urban Governance & Crisis Management: Provides detailed coverage of the Brihanmumbai Municipal Corporation's (BMC) response to major crises, particularly during the monsoon (e.g., heavy rainfall, water cuts, and public health concerns like dengue and malaria) and large-scale public safety incidents (e.g., the hoarding collapse fallout). Community Welfare & Rights: Reports on key social issues, including the financial aid scheme for persons with disabilities, the struggles of Mumbai's hawkers protesting eviction drives, and the dangers faced by workers due to the continuation of manual scavenging in water tanks. Cultural & Heritage Reporting: Covers significant community stories, including the restoration of British-era fountains and the history of institutions like the 126-year-old Chinchpokli cemetery, showing a breadth of interest beyond pure administration. Tweets @nayonikakb ... Read More

Pratip Acharya

Pratip Acharya is a seasoned journalist based in Mumbai reporting for The Indian Express. With a career spanning over a decade, his work demonstrates strong Expertise and Authority in critical urban issues, civic affairs, and electoral politics across Eastern and Western India. Expertise & Authority Current Role: Journalist, The Indian Express (IE), reporting from Mumbai. Core Authority: Pratip's reporting focuses sharply on local democracy and development, specializing in: Urban Governance and Civic Affairs: Providing in-depth analysis of municipal decision-making, city planning, and local infrastructure, essential for informed urban reporting. City Politics and Environment: Covering the political dynamics of Mumbai and surrounding areas, alongside critical environmental challenges impacting the metro region. Electoral Coverage (High-Stakes Experience): He has extensive experience in high-stakes political reporting, having covered major elections, establishing his Trustworthiness in political analysis: National: Lok Sabha elections in 2014 and 2019. State: West Bengal Assembly elections in 2016 and Maharashtra Assembly elections in 2019. Major Assignments (Ground Reporting): Pratip demonstrated commitment during crises by conducting ground reporting throughout the Covid-19 pandemic since its breakout in 2020, offering first-hand accounts and analysis of the public health crisis. Experience Extensive Experience: Starting his career in 2014, Pratip has built his foundation across multiple prominent English dailies: Started at The Times of India in Kolkata (2014). Relocated to Mumbai (2016) and worked with The Free Press Journal and Hindustan Times before joining The Indian Express. Pratip Acharya's diverse experience across major publications, coupled with his specialized focus on the intricate details of urban governance and a track record of covering major electoral and health crises, establishes him as a trusted and authoritative source for news from India's critical metropolitan centres. ... Read More

Stay updated with the latest - Click here to follow us on Instagram

Tags:
BMC

Loading Recommendations...

Mar 14: Latest News

Live Blog