BMC mulls loan against property

THE CASH-STRAPPED Bhopal Municipal Corporation (BMC) does not appear to be averse to go to any extent to generate loan. The latest corporation step ? to get valuation of its entire property to use it for seeking loan to arrange its matching share for schemes under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and Asian Development Bank ? seems to suggest that.

THE CASH-STRAPPED Bhopal Municipal Corporation (BMC) does not appear to be averse to go to any extent to generate loan. The latest corporation step — to get valuation of its entire property to use it for seeking loan to arrange its matching share for schemes under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and Asian Development Bank  – seems to suggest that.

HT Image

Finding it hard to arrange Rs 450 crore as its share in Rs 2,153 crore schemes under the JNNURM, the BMC is carrying out listing and valuation of its properties in the City.

Under JNNURM, the BMC has to arrange 30 per cent matching share to scheme cost. Sources said valuation of about 70 per cent of the properties, the value of which is estimated to be about Rs 200 crore, has been completed. So, the cost of the properties including the open land may further go up.  Besides, fixed deposits parked in the banks are also being included as part of preparations to arrange money for corporation’s share for loan.

Properties, including its office buildings, shopping complexes, reading rooms and other open land are learnt to be included in the valuation. The officials said there was a need for double entry accrual system so that it could serve two purposes.

When asked, BMC Commissioner Manish Singh also said loan would be taken depending on need to arrange the corporation share. He said the properties were being valued under the double entry accrual system. If needed, the BMC could mortgage its properties

to get loan. He, however, said the Government guarantee is required to get the loan.  The BMC administration has already taken loan worth Rs 45 crore for its various schemes, including Kolar Augmentation Scheme (Rs 14 crore), Transport Nagar (Rs 14 crore), Bairagarh Augmentation Scheme (Rs 12 crore) and MP Nagar Development Scheme (Rs 5 crore).