State to raise corpus for pending projects | mumbai news | Hindustan Times
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State to raise corpus for pending projects

As per the state’s estimate, the pending projects will need a fresh influx of at least Rs1,000 crore to complete them

mumbai Updated: Sep 04, 2016 23:48 IST
state

Taking serious note of the crucial water supply and sewerage projects, worth at least Rs8,110 crore, stuck across Maharashtra — some for nearly a decade — the state for the first time has decided to raise a corpus to extend soft loans to urban local bodies for them to be able to complete the pending works.

There are 140 such projects stuck at various stages with 97 urban local bodies across Maharashtra. As per the state’s estimate, the pending projects will need a fresh influx of at least Rs1,000 crore to complete them.

A senior officer from the state urban development department said, “We have instructed urban local bodies to use a portion of the funds that we get from the Centre’s 14th Finance Commission grants to meet half the requirement. The state will raise the remaining Rs500 crore and provide funds as soft loans.”

Officer said the state is in talks with two or three multilateral funding agencies to raise the corpus. “We are yet to decide the rate of interest and the duration for repayment. The state will have to raise and disburse at least Rs300 crore for some of the delayed projects to start moving immediately,” the officer added.

The loans will, however, not be offered carte blanche. If the urban local bodies default on the payment, then the state will reserve the right to dip into the pool of funds that the Centre devolves to the local bodies to recover the principal and interest amount. The state has set a target of completing 55 of the 140 projects in 2016-17, while the remaining 85 will be completed in 2017-18. About 42 of the 140 incomplete works have been languishing for more than eight years.

Project history

Most of the projects were approved under the previous UPA government’s Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The scheme required urban local bodies and the state government to contribute 10% each towards the project cost, while the Centre granted 80%. The scheme was, however, discontinued after the NDA government came to power in 2014.

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