BMC FDs fall by ₹13,785 cr since 2021; Congress seeks white paper

MUMBAI: The sharp decline of nearly ₹13,785 crore—from approximately ₹91,690 crore to ₹77,905 crore—in the Brihanmumbai Municipal Corporation’s (BMC) fixed deposits (FD) since 2021 has raised concerns about how the civic body’s reserves are being utilised and if the corporation will be able to meet its future financial obligations without facing a liquidity crunch

MUMBAI: The sharp decline of nearly ₹13,785 crore—from approximately ₹91,690 crore to ₹77,905 crore—in the Brihanmumbai Municipal Corporation’s (BMC) fixed deposits (FD) since 2021 has raised concerns about how the civic body’s reserves are being utilised and if the corporation will be able to meet its future financial obligations without facing a liquidity crunch. BMC’s ongoing infrastructure commitments are estimated at ₹2.34 lakh crore.

Given these circumstances, Congress group leader Ashraf Azmi demanded a comprehensive white paper from municipal commissioner Ashwini Bhide on Thursday, on the BMC’s financial position from 2021-22 to September 2026. He has sought an account of the utilisation of reserves, authorisation of expenditure and the civic body’s long-term financial sustainability, urging the administration to publish the report within 30 days and place it before the standing committee for discussion.

In his communication to Bhide, Azmi also flagged the decline of ₹3,544 crore in FDs over the last eight months.

“The decline warrants a transparent explanation of how the funds had been utilised, who had authorised the expenditure and how the BMC would finance its future commitments while maintaining adequate reserves,” Azmi told HT.

The demand also comes against the backdrop of the BMC functioning under an administrator in the absence of elected representatives for nearly four years, through which time major infrastructure projects and financial commitments continued to be made. Some of the infra projects green-lit by the BMC, for which sizeable funds were allocated, were in this period. Prominent projects include, Mumbai Coastal Road, road concretisation programme, the GMLR, reconstruction of bridges and railway overbridges, sewage treatment plants etc.

Azmi said the financial decisions taken during this period needed to be accounted for transparently before elected representatives and Mumbai’s citizens. Pointing to BMC’s 2026-27 budget, which provides for approximately ₹48,164 crore in capital expenditure, Azmi sought clarity on the proposed use of internal transfers and reserve funds to finance spending.

“The administration must reconcile the decline in reserves with actual expenditure, budgetary provisions and approvals, and clarify whether the money was used for approved projects, additional requirements, transfers between funds or settlement of liabilities,” Azmi added.

Azmi has sought a year-wise and fund-wise statement detailing withdrawals, transfers, actual expenditure and closing balances, along with details of major transactions, the departments and projects concerned, and approvals granted by authorities.

“The administration should also specify which expenditures were covered by existing budget provisions and which required revised estimates, supplementary provisions or separate approvals,” Azmi said.

Seeking a five-year financial projection, Azmi has called for details of expected revenue, recurring expenditure, committed capital spending, available and earmarked reserves and proposed borrowings. The assessment should establish whether projected revenues would be sufficient to meet the BMC’s existing and future obligations without continued depletion of its reserves.

Azmi acknowledged that a decline in reserves did not, by itself, establish financial irregularity. But repeatedly drawing on FDs to meet expenditure without a credible replenishment plan, he warned, could weaken the BMC’s financial flexibility and place an unsustainable burden on future generations, particularly as major infrastructure projects require substantial funding over several years.

In response to Azmi’s letter, Bhide issued a statement on BMC’s FDs. It stated that the FDs rose to ₹91,690.85 crore in 2021–22, partly due to reduced expenditure during the pandemic and ₹15,493 crore in revenue generated through concessions granted to developers. Following the resumption of regular expenditure, deposits declined to ₹77,905.39 crore as of March 31, 2026, before rising to ₹79,873.39 crore as of October 13, 2026.

Bhide said the decline towards the end of the financial year was largely due to substantial expenditure in February and March 2026, when the civic body incurred ₹16,071.40 crore in capital expenditure on projects. She added that fixed deposits decline in March due to higher year-end disbursements and rise again in the new financial year.

The commissioner also stated that the BMC had committed liabilities of ₹2,44,552.65 crore towards priority infrastructure projects as of April 1, 2026. These commitments would be met through additional revenue generation, improved collection efficiency, strict control over revenue expenditure, transfers from internal funds and alternative sources of financing, if required.