State to bail out BMC with Rs 3000 crore loan

The cash- strapped Brihanmumbai Municipal Corporation (BMC) has something to cheer while planning for the next year's budget, as the state government has agreed to pay an internal loan of Rs 3,000 crore. The approval is expected to help the civic body a great deal in implementing its ongoing projects, which have been dragging due to lack of funds.

According to the civic sources, the state government has in principal given its nod to BMC to lift internal loans of Rs 3,000 crore, which is most likely to be given from the civic provident fund coffers. The ruling Shiv Sena- BJP combine in the BMC had been demanding internal loans from the state government since the last couple of years to carry out its projects.

Their leaders had even alleged that Congress- ruled state, had been deliberately denying disbursing funds from internal loans, which has caused a delay in floating of new tenders for civic projects.

However, the state government has asked for a list of specific projects the BMC will be spending the internal loan amount on. Instead of using these funds for wardlevel works like slum development and other schemes, they want the money to be used on bigger projects, so that they would be completed on time.

A senior civic official said, ongoing projects like roads, sewage treatment plants, storm water drains, dumping grounds, hospitals would feature prominently in the BMC's list to be submitted to the State Government for demanding internal loans. The internal loan was even passed for this financial year, but it was too late to use it meaningfully. So we have decided to spend it from next year's budget on the civic projects, he added.

The loan amount would be later returned to State Government in a phased manner, he added.